Homeowners: Here's what's in the tax bill for you

Homeowners: Here's what's in the tax bill for you by Kathryn Vasel @KathrynVasel Republicans on Friday unveiled the final version of their tax bill, and it has new restrictions for some homeowners. Senate and House Republicans have reconciled their versions of tax legislation and the final plan shrinks some popular deductions. Lawmakers aim to vote on the bill next week and then send it to President Trump's desk. Here's a look at what the changes could mean for future and current homeowners: Downsized mortgage interest deduction New homebuyers would now only be able to deduct interest on the first $750,000 of mortgage debt on a newly-purchased home. That's down from the current $1 million threshold, but higher than the $500,000 limit the House proposed in its tax overhaul in November. Current homeowners would not be affected by the lower cap. The deduction has helped make home buying more affordable for some homeowners. While the median home price nationwide is currently $254,000, buyers in some cities face much higher price tags. The lower limit could make it harder for house hunters in expensive cities. For instance, in New York City, nearly 64% of mortgages on homes sold this year were over $750,000, according to data from ATTOM Data Solutions. And in San Francisco, 58% of home loans exceeded the new cap. Some experts worry the increased threshold could keep people from selling their homes, which could squeeze the already short supply of housing. "The mortgage interest deduction change will put downward pressure on prices as well as sales," said Joe Kirchner, senior economist at Realtor.com. Current homeowners might hesitate to trade up to a more expensive house if the price tag is too high to take full advantage of the deduction. The new cap would also apply to mortgages on second homes. The original House bill wanted to eliminate the deduction on second homes. Less reason to itemize Homeowners must itemize their taxes if they want to claim the mortgage interest deduction. But since the final bill calls for nearly doubling the standard deduction, far fewer Americans are expected to itemize come April. "In my generation, before we had a home we took the standard deduction, but as soon as we bought a home we started itemizing because that mortgage interest deduction was so significant," said Kirchner. "Now with the higher standard deduction very few people will itemize. It will virtually eliminate the deduction on a practical level." The final tax bill also eliminates the deduction for interest on home equity loans. Currently that's allowed on loans up to $100,000. Limit on property tax deduction Taxpayers will no longer be able to fully deduct state and local property taxes plus income or sales taxes. Instead, the legislation allows individuals to deduct up to $10,000 in state and local income and property taxes or state and local property and sales taxes. That means homeowners living in high-tax states like New York, California and New Jersey could see an increase in what they owe Uncle Sam in April. Nationwide, 4.1 million Americans pay more than $10,000 in property taxes, according to data from ATTOM Data Solutions. Tax break stays for home sellers Both the House and Senate bills originally wanted to scale back a tax break for homeowners when they sell their home for a gain. Taxpayers will still be able to exclude up to $500,000 (or $250,000 for single filers) from capital gains when they sell their primary home, as long as they've lived there for two of the past five years. Earlier tax reform proposals would have increased the live-in requirement to five out of the last eight years. CNN's Lauren Fox and Phil Mattingly contributed. CNNMoney (New York) First published December 17, 2017: 12:17 PM ET

Does the American Dream no longer include homeownership?

While it has no official definition, the American Dream has always been the notion that citizens of the United States can better their lot in life through hard work. That encompasses the idea that hard-working kids of hard-working parents would have a better life than the previous generation, and homeownership has generally been considered part of that. A decade after the housing market crashed, the homeownership part of the American Dream has become more elusive, according to a new study from Pew Research Center. The report, which analyzed Census Bureau housing data, showed that more United States households "are headed by renters than at any point since at least 1965." Between 2006 and 2016, the U.S. added 7.6 million households, but "in part because of the lingering effects of the housing crisis," according to Pew. Powered by SmartAsset.com SMARTASSET.COM During that 10-year period, the number of households renting their homes jumped from 34.6 million (31.2% of the total) to 43.3 million (36.6%). That tops the relatively recent high watermark of 36.2% renting in 1986 and 1988, while coming in just below 1965's 37% renters rate. Young adults lead the way While young adults have historically been more likely to rent than other age groups, the numbers are increasing. More than 6 in 10 (65%) of households headed by someone under 35 rent, Pew reported. That's up from 57% in 2006 but it's not as big a gain as the 35-44 age group made where the percentage of renters jumped from 31% in 2006 to 41% in 2016. The numbers rose among Americans 45-64 as well, going from 22% in 2006 to 28% in 2016. In fact the only demographic studied that did not post an increase was those 65 or older who stayed flat at 20%. It's not that people don't want to buy In many cases the increase in renters has been blamed at least partially on Millennials not wanting to be tied down or not working hard enough to afford buying. In fact most renters want to buy, according to a separate Pew report: "In a 2016 Pew Research Center survey, 72% of renters said they would like to buy a house at some point. About two-thirds of renters in the same survey (65%) said they currently rent as a result of circumstances, compared with 32% who said they rent as a matter of choice. When asked about the specific reasons why they rent, a majority of renters, especially nonwhites, cited financial reasons." While mortgages are cheap on a historical basis, inventories remain low, prices have soared, and mortgage standards have remained tough. Banks and other lenders may have more flexibility than they did right after the housing crisis, but the days of stated income, low-doc, or even no doc loans are largely gone. Add in the fact that some capable, qualified buyers have decided to put off homeownership due to lingering fears over the economy and you can see why homeownership has declined. Related links: • Motley Fool Issues Rare Triple-Buy Alert • This Stock Could Be Like Buying Amazon in 1997 • 7 of 8 People Are Clueless About This Trillion-Dollar Market Americans still want to buy houses. Some of us can't afford to right now, while others are waiting for better opportunities. Many simply lack the means to reasonably expect ever to be able to make a purchase. Owning a home remains part of the American dream, at least for most Americans, but it's also a less attainable goal than it was for previous generations. CNNMoney (New York) First published July 24, 2017: 10:41 AM ET

We are back!

We are back! We have spent the summer working out of the Woodside office while ours was being remodeled. It's finally finished and looks fabulous! We moved back in yesterday. Please stop by and say "hi" if you are downtown.

Bay Area rents see summer jump

There was an uptick across most of the region last month Not too long ago, Bay Area renters began to feel some relief. In the latter part of 2016, analysts described softening rents and, indeed, a plateau appeared to have emerged early this year. But here we go again. Related Articles Stanford opens affordable housing site Mayfield Place Real Deal: California housing market rebounds in May, but inventory remains low RV dwellers brace for Palo Alto’s 72-hour parking crackdown Silicon Valley Realtors urged to find solutions to housing issues … and fast Biz Break: AMD falls in “Epyc’s” wake; Toast with a mortgage The cost of renting an apartment moved up in June across the region, according to a new analysis from ApartmentList.com, a website that tracks the national rental market. Nationwide, the median rent for a two-bedroom apartment was $1,150, up 2.9 percent from a year earlier. Most Bay Area cities were about double that, or more. Here are a few highlights from the report. In San Jose, the median monthly cost of a one-bedroom flat was $2,050, while a two-bedroom went for $2,570. Month-over-month, that spelled a 1 percent increase, while the year-over-year increase was 2.2 percent. In Oakland, a one-bedroom unit typically rented for $1,710 last month, a two-bedroom for $2,150. Month-over-month, the increase was 1.2 percent, while June rents were up 2.8 percent from the year before. In San Francisco, a one-bedroom fetched $2,420 and a two-bedroom cost $3,040. There was a small boost of less than 1 percent on a month-over-month basis, but San Francisco’s rents actually were down slightly year-over-year, by just under 1 percent. Get top headlines in your inbox every afternoon. Sign up for the free PM Report newsletter. If any of these numbers come as a surprise, that’s because ApartmentList.com has altered its methodology “to provide more accurate rent estimates and avoid luxury bias in private listings,” explained Andrew Woo, data scientist for the website. Its December report had indicated a median monthly cost of $4,550 for a two-bedroom flat in San Francisco and $2,500 for a two-bedroom in Oakland. Rents have not tumbled drastically in the time since, Woo explained. In fact, with the exception of San Francisco’s small year-over-year decrease, rents have increased across the region. The latest numbers, however, reflect the website’s adjustment in methodology. Several other numbers jumped out of the report — for instance, one showing that a two-bedroom in Fremont ($3,550) cost more than one in San Francisco, another showing that a two-bedroom in Cupertino ($5,040) was pricier than similar apartments anywhere else in the region. Woo explained: “In smaller cities, for example, Cupertino, rentals and neighborhoods tend to be more homogeneous, whereas in larger cities like Oakland rents vary more between neighborhoods, often resulting in lower median rents. Additionally, a two-bedroom in Fremont may be more spacious than a two-bedroom in San Francisco, resulting in a higher rent price.”

Menlo Park: Boarding house proposed along Willow Road

MENLO PARK — A property owner hopes to build a boarding house along Willow Road in Menlo Park, according to city documents. While a city planner acknowledged that the project, if approved, would be a “single-room occupancy type of building,” he said it would not operate like a hotel, as all tenants would at least have monthly leases, and it would be geared toward high-income workers. “It’s our understanding that it would likely be longer-term leases,” Senior Planner Kyle Perata said, adding that he wasn’t aware of the city receiving any boarding house applications in the past. “It would be market-rate units, it would not be part of the (city’s) below-market-rate program.” ADVERTISING The project is planned for 555-557 Willow, where Menlo BBQ currently operates. The restaurant would continue at the site whether or not the project is approved. Property owner Reza Valiyee seeks to tear down a long-vacant office building and construct a three-story building with 16 bedrooms. Each bedroom would contain an individual bathroom, but all residents would share a common kitchen and living room. The project would trim the current 20 parking spaces at the site to 14, with four of them covered spaces. Perata didn’t have additional details, as the project is still undergoing an initial review. The proposal would need to go before the Planning Commission for approval, but has not yet been put on the city’s calendar. Perata encouraged people with questions or comments about the plan to call him at 650-330-6721 or email him at ktperata@menlopark.org. Maureen Holding, a nearby resident, wrote a letter to the city saying the project would be out of character with the surrounding neighborhoods. “Placing either a hotel or college-type dormitory in the midst of a family-oriented neighborhood is certainly not appropriate,” Holding wrote. In September 2014, Valiyee proposed to convert the existing office building into two residential units containing five bedrooms each, but it stalled after the Planning Commission raised concerns about adding another floor. Email Kevin Kelly at kkelly@bayareanewsgroup.com or call him at 650-391-1049.

Bay Area fireplace rebate applications to start Friday

SAN FRANCISCO — Starting Friday, Bay Area homeowners can apply to receive $750 to $12,000 in rebates to replace wood-burning fireplaces or stoves with cleaner gas or electric heating devices such as fireplace inserts. Preparing to give away big public subsidies to reduce smoke, the Bay Area Air Quality Management District set 10 a.m. Friday to begin taking applications for a total of $3 million in rebates. Pollution officials urge homeowners to sign up promptly because the rebates are available on a first-come, first served basis. The money is expected to cover rebates for only about 1,500 homeowners, and 40 percent of the funds will be set aside for low-income homeowners or residents of ZIP codes heavily impacted by winter smoke, or neighborhoods without access to natural gas pipelines to heat homes. “We expect the rebates to go fast,” said Tom Flannagan, an air district spokesman. “We’re doing the rebates now so that these installations will be done over the next few months and people in winter can enjoy the benefits of switching from their dirty old wood-burning devices to cleaner alternatives.” Rebates start at $750 to decommission and seal up a fireplace and $1,000 to replace a fireplace with a natural gas fireplace insert, which relies on gas logs to produce flames. Low-income homeowners are eligible for larger grants. The maximum rebate is $12,000. Flannagan said that to fill out the application, homeowners need to figure out generally what type of device they intend to install — such as a gas fireplace insert. Before the installation can begin, homeowners selected for grants must receive an air district notice that their project plan has been approved. The air district last year set aside the $3 million for the rebates in an effort to protect public health from wood smoke particles, which can lodge deep in the lungs and cause or aggravate asthma, strokes and other problems. Burning wood fires is generally banned in the Bay Area on Spare the Air days in winter unless a homeowner lives in an area where the only option for home heat is a wood-burning device. However, under a new district rule effective Nov. 1, homeowners wanting an exemption from the no-burn rule must register their stove or pellet stove with the district to verify it’s a low-emission model certified by the federal Environmental Protection Agency. Contact Denis Cuff at 925-943-8267. Follow him at Twitter.com/deniscuff or facebook.com/denis.cuff. HOW TO GET A REBATE Homeowners can submit applications for rebates to replace fireplaces with cleaner devices either online at www.baaqmd.gov/WoodSmokeGrant or by calling 415-749-5195. Visit the same website for information about rebates Rebates vary by device installed, and can be as much as or less than the cost of the new device installed. The base rebate is $750 to seal and close off an existing fireplace. The rebate is $1,000 for a new gas fireplace insert, and $3500 for an electric heat pump. To seek the rebates, homeowners must live within the air district, which covers seven Bay Area counties and southern portions of Napa and Solano counties.

2017 DOWNTOWN SAN CARLOS SUMMER WINE STROLL

2017 DOWNTOWN SAN CARLOS SUMMER WINE STROLL Sunday, June 11, 1-5 pm Enjoy a festive afternoon exploring boutique wines. 20 Merchants will open their shops as Pouring Stations, and they will also serve light bites to nibble. Start at the Event Check-in area on Cherry Street at Laurel, between Diddam's and Rangoon Ruby Restaurant. You will receive a glass, wristband, and program. All tastings are sample servings. Must be 21+ with Valid ID to participate. $35 per person through May 31 $40 per person June 1 to June 9 No reservations accepted on June 10 $45 per person day of event, June 11 RAIN OR SHINE - NO REFUNDS https://sancarloschamber.org/winestroll/

Dealing With Your Neighbor's Trees

Dealing With Your Neighbor’s Trees With all this rain, many homeowners are dealing with tree related issues: trees and or branches falling down. In San Carlos and in general, if your neighbor has a tree hanging over on to your side of the property, you have the right to cut any part of the tree that is over your property line as long as you don't permanently damage the tree. To avoid legal problems, notify your neighbor (the owner of the tree in question) of your intentions before you begin so your neighbor has an opportunity to take care of the problem. If the tree is protected (most cities have heritage tree laws) and you want to severely trim the tree, you may need to get a tree permit from the city. Please consult the NOLO Press book Neighbor Law: Fences, Trees, Boundaries and Noise for the ins and outs of private tree issues. #trees, #rain, #LivinginSanCarlos, #SanCarlosHomes, #SanCarlosRealEstate