Real Estate: Short-sale tax relief could expire in 2012
A federal tax exemption that has spared struggling homeowners from paying hefty taxes on their mortgage debt after a short sale or principal modification is getting ready to expire.
That means starting next year, homeowners will get tax bills — which could amount to thousands of dollars — for the amount that was forgiven.
Fresno real estate agents are hoping Congress will extend The Mortgage Debt Relief Act of 2007, which expires Dec. 31. It did once already in 2010.
If not, the market could expect foreclosures to increase and home prices to fall, housing experts say.
“These bills will certainly damper the homeowner’s enthusiasm to sell and would cripple our modest housing recovery,” London Properties President Patrick Conner wrote in an opinion piece in Sunday’s Bee.
A principal reduction or a mortgage debt that is forgiven by a bank as the result of a short sale — where a house is sold for less than it is owed to the lender — is considered taxable income.
The debt relief act gave homeowners a break from paying that tax.
Real estate agents who specialize in short sales are encouraging homeowners thinking of selling their homes in a short sale to do it now.
“To have the opportunity to get out from underneath that debt and not be responsible for (taxes) on the difference is huge,” said Pamela Santy, a real estate agent with Guarantee Real Estate.
“What other time have you been given the opportunity to be relieved of that debt?”
To educate the public on short sales and the tax exemption, Guarantee is holding a short-sale seminar 6-8 p.m. Tuesday at 5380 N. Fresno St.
Fresno housing symposium
The Gazarian Real Estate Center at Fresno State is holding a conference in October to give real estate professionals and the public a look at Fresno housing conditions.
The 2012 Fresno Housing Market Symposium will be held 8 a.m.-noon Oct. 4 at the University Business Center at the Craig School of Business. Registration is required.
Speakers include Mark Boud, president of Real Estate Economics, an Irvine consulting firm; Robert Stephens, an economist from the U.S. Department of Housing and Urban Development; and a panel of local housing experts.
To register, visit gazarian.info or call (800) 321-5011.
Industrial vacancies stable
Few transactions and almost no new construction in Fresno’s industrial real estate market have kept vacancy rates stable so far this year, according to a midyear survey from Fortune Associates.
The vacancy rate in the Fresno and Clovis area stood at 12.3% at the end of the second quarter, compared to 12.2% at the end of 2011, the survey said.
Downtown Fresno, northwest Fresno and the Woodward Park areas saw slight increases in vacancies, while other areas remained about the same.
John Hans, a commercial broker with Fortune, a Fresno commercial real estate company, says the California high-speed rail project contributed to the small increase in downtown vacancy.
“There are properties staying vacant, that won’t lease, because you tell a tenant high-speed rail is coming and they say, ‘OK, what else do you have?’ ” Hans said.
But things are looking up. More inquiries are coming in from people wanting to find industrial space, and a few small leases are being signed.