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Who’s Buying and Selling Homes in 2017?

The National Association of Realtors just released the  2017 Profile of Home Buyers and Sellers survey which provides demographic insights into the real estate market nationally. For most home buyers, the purchase of real estate is one of the largest financial transactions they will make. Buyers purchase a home not only for the desire to own a home of their own, but also because of changes in jobs, family situations, and the need for a smaller or larger living area. This annual survey conducted by the National Association of Realtors® of recent home buyers and sellers provides insight into detailed information about their experiences with this important transaction. Here are highlights from the latest report.

  • First-time buyers made up 34 percent of all home buyers, a decrease from last year’s 35 percent.
  • Age for first-time buyers remains flat, but the age of repeat buyers continues to climb—now at an all-time high of 54.
  • Married couples continue at 3-year decline, while single females increased for the 3rd year.
    Buyer and seller use of agent remains at historical highs, 87% and 89% respectively. FSBOs remain at an all-time low of 8%.
  • Drop in those who stalled their sale of the home because they were underwater to 10%, but it is still common among those who purchased 8-10 years ago at 26%.
  • Tenure (holding on to the same property)  remains at an all-time high of 10 years.

In Ridgefield, we are seeing young families make the move to the suburbs, while empty-nesters are starting to downsize. While we may not have seen the gains in value that some of the country is experiencing, 2017 has been a strong year for both single-family unit sales and median home values.  We hope to see this trend continue through the end of the year.

 

Source: “2017 Profile of Home Buyers and Sellers,” National Association of REALTORS® (Oct. 30, 2017)

5 Tips To Help Lower Your Heating Bills

You wouldn’t know it given the 75-80 degree weather we’ve been experiencing over the last week, but winter is just around the corner! while heating your home is a cost we all expect, there may be ways to reduce how much you pay. Here are some tips from Fixr.com, which provides “Cost Guides” of estimates to common household remodeling projects, highlights five projects to help increase a home’s energy efficiency and keep utility bills lower.

1. Find unorthodox heat sources. More efficient sources of heat are available, particularly if the home is in a milder climate or if the home can be broken into zones.

A heat pump can help lower your electric bills by 50 percent if you currently use electricity to heat your home. Heat pumps cost about $7,500, but will pay for themselves with reduced energy costs. Switching to a geothermal heat pump will save you even more. According to Money Crashers, geothermal heat pumps qualify for a tax credit equal to 30 percent of equipment and installation costs, with no upper limit. Pumps are also frequently paired with things like radiant heat flooring in specific areas of the home, as they are more effective at using energy than either baseboards or radiators and can help supplement the heat in smaller spaces.

Radiant heat costs between $6,000 and $14,000 if covering your whole home, but you can often install it in a single room for around $700. Paired with a heat pump, this will keep your home warm while significantly lowering your energy bills.

2. Add extra insulation. The amount of insulation that your home needs is directly tied to the type of heat source you have. Many homes are actually underinsulated for their climate and their heat source, resulting in their furnaces or radiators having to work harder than they need to and causing a spike in energy bills.

Insulating even a single room in your home can dramatically increase comfort and help you lower your thermostat, resulting in smaller bills. Adding insulation to your attic can also help you prevent costly and damaging ice dams as well, saving you even more. The cost to insulate a single room in your home is around $1,200 to $1,800, and will recoup about 107 percent of the cost at time of resale, making this one of the best improvements you can do for your home.

3. Take care of your furnace. Furnaces are one of the most commonly used ways to heat large homes. Unfortunately, they often have a wide range of efficiency that could be costing you more in monthly bills than they need to.

If your furnace is less than 10 years old, make sure to schedule regular maintenance to keep it running at peak efficiency. This involves changing the filter and making repairs as necessary. The most common furnace repair involves replacing the heat exchange, for around $1,000 to $1,700.

If your furnace is older than 10 years, replacing it can dramatically increase its efficiency. Older furnaces only run at around 50 percent efficiency, while newer models can reach rates of 90 percent, making them a much better choice for keeping monthly bills down. A new furnace costs around $3,000 to $5,000, but will pay for itself in lowered bills over time.

4. Make the switch to gas. If you’re currently heating your home with electricity or oil, you’re likely spending more each month than you would if you switched to natural gas. Gas furnaces are much more efficient than oil or electric heaters, which can save as much as 30 percent on energy bills each month.

The cost to install a new gas system in your home is around $6,000 to $8,000, assuming you have ducts already in place. This upgrade makes the most sense if your current heating system is over 10 years old, as you’ll see the largest gains. The typical ROI of a new gas furnace system is around 15 percent, which means that it will pay for itself in just 6 years.

5. Complete an energy audit. Your home may be losing a great deal of the energy you use to heat it, without you even realizing it. An energy audit—or a comprehensive look at how your home uses and loses energy—will help you find ways to make your home more efficient overall.

An energy audit costs about $150, and many times this cost will be rolled into any upgrades you may choose to make, allowing you to save more. Conducting an energy audit before you have any other work or upgrades done on your home can help you make better informed decisions about the space, maximizing your potential efficiency and savings.

Ridgefield’s 2017 Mid-Year Market Report

The first half of 2017 had sellers chomping at the bit to get their homes on the market early and take advantage of the relatively mild weather. Buyers were also out in full force looking to move when the school year ended and take advantage of the increased inventory. A very wet spring curtailed some of the action but unit sales have still surpassed 2016 by 17%, which is encouraging for steady growth. While home values have not risen, we have seen a competitive marketplace with multiple offers and homes selling for more than the asking price on numerous occasions. Also interesting is the segmentation that seems to be occurring in the market with the greatest gains seen in the $500,000-$600,000 and the $800,000-$900,000 categories. This is encouraging for middle-class families who are looking to upsize, downsize or move to the area for our wonderful schools, low crime, superb cultural offerings, family-friendly lifestyle, and proximity to major commerce centers.

Ridgefield Market Snapshot
Overall, the first half of 2017 has been a success for the Ridgefield Real Estate market. Unit sales increased 17.1% from January to June 2017 with 178 parcels selling compared to 152 in the first half of 2016. Total sales volume was also up 6.1% from $118,218,854 last year to $125,453,815 in 2017. The majority of home sales were priced under $1 million. If the market continues at its current pace, we are on track to match or exceed last year’s results.

Sellers Or Buyers Market
Inventory hit a record low in June 2017 with only six months worth of housing available for purchase. While this would suggest a sellers market, it does not yet seem to be playing out that way. The mid-year Sales-to-List Price Ratio held steady at 96.8%, slightly up from 2016’s 96.2%. However, pricing and the condition of the home still seem to be the key to selling with buyers using technology to assess for themselves what they think a property is worth. Sellers are also becoming increasingly savvy by staging and upgrading their homes for a quicker, more profitable sale.

Prices Holding Steady
The Median Sales Price for a single-family home in Ridgefield decreased by 5.0% from $660,000 in the first half of 2016 to $627,000 during the same time period in 2017. The average sales price also decreased from $772,672 to $704,797. Most of the growth in the first half of 2017 was seen in the $500,000 to $900,000 sector with 101 homes sold as compared to only 71 last year.

The Luxury Market
The luxury market – generally defined as homes selling for $1.5 million and above – saw a marked decrease in activity over the first half of 2017. Only two homes sold in this price range – one for $2.9 million and one for $3.1 million. There were no home sales between $1.5 and $2 million, which is unusual. Currently, as of July 1st there are four additional homes in this price range that are either under deposit or under contract to close by Labor Day, and anecdotally activity has picked up with more showings occurring in this price point. Sales were strong in the $1 million to $1.5 million category mimicking 2016 with 21 sales as compared to 22 last year.

Where Are People Buying?
Using Town Hall as the center of the Village, 37% of all sales occurred within a 2 mile radius in what would be considered “in-town” properties. Additionally, these in-town properties commanded a Median Sales Price of $739,000 and an Average Sales Price of $807,288, which is well above the town as a whole. The results support a continuing trend towards more walkable residences. We expect to see in-town properties remain desirable as both younger families escape the city and empty-nesters downsize. Upper end condominiums were also in high demand with five sold that were priced over $700,000, including one priced at $1,860,000.

Sales Up Across The Board
All Fairfield County towns experienced significant growth in the number of homes sold during the first half of 2017, reiterating the fact that individuals and families still consider Fairfield County a great place to live. However, it was a mixed message when it came to median home values with some towns showing double-digit increases, while others saw prices remain relatively flat or somewhat decreased. Traditionally more affordable towns like Stamford and Norwalk saw gains in pricing, while Wilton, Ridgefield and Redding saw values slip. Surprisingly, Westport experienced an almost 10% increase in median home value after seeing decreases during the past two years. Overall, slow but steady growth seems to be what we can expect throughout the county in the upcoming year.

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Fairfield County High Schools Among Best In Connecticut in 2017

The annual Niche.com ranking has been released and Fairfield County public high schools have done well.
Niche, a website for researching schools, used a variety of factors, including SAT/ACT scores, student-teacher ratio, the quality of colleges students consider and reviews from students and parents for its ranking.

In the number 1 position was New Canaan High School, followed by Staples High School in Westport, Greenwich High School and Weston High School. Wilton High School ranked number 7, Joel Barlow in Redding at 8, Darien High School at 9, and Ridgefield High School number 12.

The ranking also took into account how parents and students responded to surveys about their school, cultural diversity on campus, school absenteeism, teachers salary, state test scores, facilities, and the availability of clubs and activities, to name a few.

To see the full ranking list and to read more about the methodology, see the Full Report.

Ridgefield’s 2016 Year End Market Report

What a year! The Ridgefield Real Estate market rallied resulting in the best year since 2013’s banner season. Overall sales volume was up at $259,407,724 as compared to $241,208,027 in 2015. Unit sales increased 8.1% with 348 homes selling in 2016 compared to 322 the year before. With the uncertainty of an election year behind us, as well as steady increases seen in financial markets and slowly rising interest rates, there is reason to believe that this trend towards slow and steady growth in the Ridgefield Real Estate market will continue.

A Buyer’s Market
Buyers were out in force in 2016, and they had a lot to choose from. Armed with a plethora of information at their fingertips, historically low interest rates and a 12.5% increase in Ridgefield home inventory over 2015, they were able to make better, more informed decisions than ever before. The fourth quarter of 2016 was unusually busy and set up a strong pipeline into the first quarter of 2017. This is reminiscent of what happened at the end of 2012 and into 2013. Predictors suggest continued growth and improving sales throughout 2017.

No Bump In Price
The median sales price for a Ridgefield home remained relatively the same in 2016, decreasing
by only 1.9% to $640,000 from last year’s 2015 $652,500. The average sales price was $745,424
compared to $749,093 in 2015, while the sale to list price ratio was 96.4%. The rise of the “HGTV -phenomenon” placed a burden on sellers with buyers expecting homes to have kitchen and
bathroom upgrades, as well as more current design elements. We see this trend continuing.

Looking Ahead
While there has been no appreciable increase in home values, the market indicators continue to point to a stable real estate market. With inventory increasing, and interest rates slowly climbing, buyers will continue to look to invest in homes they feel offer real value. As always, location plays a key role in purchasing decisions with homes residing in-town or in good commute locations creating the greatest demand. As baby boomers become empty nesters, all indicators point to a demand for more functional homes that can be easily maintained. At the same time, we have seen upward movement in the market from Ridgefield residents moving their families into more spacious homes, as well as from buyers moving into Ridgefield to take advantage of our highly-ranked schools and great community.

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Happy Holidays To All

During the Holiday Season, our thoughts turn gratefully to those who have made our progress possible. It is in that spirit that we say thank you. Best wishes for a happy and healthy new year from all of us at Karla Murtaugh Homes.

Ridgefield Market Report : Mid Year Review 2016

Holding Steady

Coming off a mild winter, we were anticipating a better than average Spring Market and unit sales were actually up 9% over the same period last year. While the median sales price remained somewhat flat, the average price for a single family home experienced a 4.3% increase.

News of GE moving its headquarters out of nearby Fairfield, CT was disappointing, but has not had a negative effect on the property values here in Ridgefield. Fairfield County continues to be one of the most desirable regions in the tri-state area to live, and Ridgefield in particular continues to offer great value with the award-winning schools, vibrant downtown, numerous cultural destinations, strong community presence, beautiful landscapes, amazing quality of life and a reputation as of being one of the safest towns in the US.

Supply and demand will continue to drive the market. Most of our growth occurred in the under $1 million segment, but we did experience a small increase in units sold in the upper segments as well. We saw more demand in the $600,000- $800,000 segment outpacing the inventory available during the spring market. At the same time, inventory grew in the luxury segment, where demand was not as high. It remains a buyers market, which keeps raising the bar in terms of expectations. Buyers respond favorably to properties that reflect the latest design trends, are in “turn-key” condition and are priced properly, therefore portraying good value.

Looking Ahead

Another strong indicator of a healthy market is the number and value of pending sales. As of July 1st – based on the number of properties already in contract and under deposit – we have the potential to sell an additional 100 properties before Labor Day. This should keep us on track until the end of the year – and at a minimum – it will keep us on par with 2015. The fourth quarter is a bit tricky to predict considering the upcoming Presidential Election and the mitigating economic factors such as Brexit and other international influences. With interest rates still historically low, we should see serious buyers strongly seeking out the best value.

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4 Home-Related Tax Deductions You Shouldn’t Overlook

Tax season is upon us, and if you’re a homeowner, you can claim some sizable deductions that may help reduce the amount you’ll owe.

Mortgage interest, property taxes and mortgage insurance premiums are just some of the deductions you can take if you have a mortgage on your home. Together, they can add up to thousands of dollars in savings on your tax bill.

Mortgage interest

Home mortgages are structured so that a huge chunk of each payment you make in the initial years of ownership goes toward paying down the interest on your loan and only a little goes toward the principal. The good news is that you can deduct the interest payments on your primary (and sometimes a secondary) residence — up to $1 million (or $500,000 if you’re married and filing separately).

Most homeowners count this as one of the largest deductions on their tax bill each year. It applies to home purchases and mortgage refinances, home equity lines of credit and home equity loans, sometimes called second mortgages. The deductible interest on home equity debt — regardless of how you used the money you pulled out — applies to loans of $100,000 or less throughout the year (or $50,000 if you are married and filing separately).
This deduction, filed with IRS Form 1098, can add up to thousands of dollars for most homeowners. The benefit: It reduces your taxable income so you don’t owe as much come tax time.

The key to taking advantage of the mortgage interest deduction is itemizing your deductions in meticulous detail, Poulos says. Your lender will send you a statement each year to let you know how much interest you paid; that will help you figure out if it’s worth your while to itemize.

Points

If you bought a home in 2015, there’s another deduction (score!) you get to include on your tax bill: mortgage points. Most borrowers pay for points, which come in two forms: discount points, which allow you to prepay some of your loan interest in exchange for a better mortgage rate; and the loan origination fee. One point is equal to 1% of your loan amount. Many homeowners completely overlook this deduction, Poulos says.
Let’s say you bought a home in New York using a $500,000 loan with a 1% origination fee. That’s $5,000 you can itemize as a deduction on your tax bill, and you want to get credit for each and every dollar you spent.

Your lender should provide you with a copy of your settlement statement, with the loan origination fee and discount points listed on it, in January. If you don’t receive a copy, ask for one and verify that this information is listed on it so you can take advantage of the deduction on Form 1098.

Property taxes

Another perk of homeownership is writing off your annual property taxes. You get to deduct these taxes in the year they’re paid, not the year they were due.

Your county’s property assessor’s office typically sends out a statement at the beginning of the year showing the amount of your property taxes. One more thing to keep in mind: If you bought a home and reimbursed the sellers for taxes they had already paid for the year, you’ll see that reflected on your settlement statement, not on your 1098.

Mortgage insurance

If your down payment was less than 20% of your home’s purchase price, you’re likely paying a mortgage insurance premium. Through the end of 2016, the mortgage insurance premium deduction includes policies provided by the Department of Veterans Affairs, the Federal Housing Administration and the Rural Housing Service, as well as private mortgage insurance from conventional lenders, issued after 2006.

The IRS treats your mortgage insurance premium payment as mortgage interest that you can deduct on Schedule A of Form 1040. Although the overall amount of your premium can be counted as an interest deduction, it phases out for high-income earners, Poulos says. For instance, you can’t deduct your mortgage insurance premium if you earn an adjusted gross income of more than $109,000 (or more than $54,500 for married couples filing separately).

Items you can’t deduct

Sure, you get some pretty sweet deductions as a member of the homeowners club, but there are some exceptions. Here are a few real-estate-related costs you can’t deduct:

Home and title insurance coverage (other than mortgage insurance premiums)
Depreciation
Utilities, such as gas, electricity and water
Most settlement costs (other than points)
Forfeited deposits, down payments or earnest money
Home improvements paid via a private loan, cash or credit card
Homeowners association fees
Transfer taxes (stamp taxes) in a personal home sale

Check out the IRS list of special situations and other nondeductible items related to homeownership.

Bottom line

One of the major benefits of owning your home has always been the tax write-offs that come with the package. Keep in mind, though, that if your itemized deductions don’t add up to as much as the standard deduction you’re eligible for, the standard deduction would be the better way to go.

If you have a complicated tax situation or you’re unsure about certain real-estate-related deductions, it’s a good idea to consult with a licensed tax professional for guidance. You don’t want to miss out on deductions that will lower your tax burden and keep more money in your pocket.

Homeownership can have some pain points along the way, but the tax benefits you reap help make the largest investment of your life pay off in the long run.

*This article has been edited. Original article appears on NerdWallet

Ridgefield Market Report : Year In Review 2015

Staying The Course

When reviewing the 2015 sales results, one can interpret that the real estate market is flat when compared to 2014. I think that is an accurate statement, but it is also safe to say that we are staying the course when it comes to market stabilization, avoiding the large swings in value or unit sales seen in previous years. Essentially, Ridgefield real estate sales showed 100 more homes sold than in 2009, and only 9 less than in 2014. In both 2014 and 2015 we did not experience a traditional spring market surge, partly due to the severe and extended winter weather, and consumer confidence still seems to be the driver in bringing buyers to the market. Observationally, when analyzing sales by price point, the typically consistent $1.5- $1.75 million struggled in 2015. Conversely, we had a nice uptick in the $2 million and higher category.

The Power Of Proper Pricing

Pricing your home properly from the start is one of the key factors in achieving the best possible outcome for sale. Buyers are savvy and intuitive and can easily determine if they need to act quickly or wait to see if a price adjustment is imminent. We are not seeing many low ball offers, therefore do not feel like you need to build in a cushion. An equally important factor is making sure that your home is “turn-key”. Focus on a few important rooms. For example, if you are a few years away from listing your home for sale and feel that your kitchen is in need of some updating – don’t wait! If at all possible – do the updates now, and enjoy living with them until you are ready to sell.

No Longer A Wild Ride

Since 2013, the Ridgefield real estate market has been steady in both price and unit sales. Fairfield County as a whole has experienced that same stability. Moving into 2016, I see a trend of increasing consumer confidence that real estate is once again a stable investment.

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