West Savage Real Estate Blog

House Tax Bill to Eliminate Mortgage Interest Deductibility

Our real estate lobbying organization received overwhelming response to last week’s “Call for Action” on the House Tax Bill that proposed eliminating the deduction for property tax and mortage interest.  If you were among those that called or emailed our legislators, we thank you!   A strong message was sent.   These actions are the wrong things to do, and certainly at the wrong time.  

Unfortunately, the bill did pass, by a narrow margin.  The vote was 68 DFL votes for and 65 DFL & Republican votes against the bill.  In the debate, legislators from both sides brought up issues related to Minnesota's heritage, taxes, spending, jobs, local property taxes and the need to fill the state’s budget shortfall.  You can view the entire debate and track the final vote on the Minnesota House Legislative web site, http://www.house.leg.state.mn.us. 

Moving forward, the two legislative bodies will enter into a Conference Committee.  This is the group that will draft the final legislative proposal to Governor Pawlenty.  The two bills will be examined, and the most popular proposals will be adopted.  Changing the deduction for Mortgage Interest and Property Taxes is one of the most controversial issues on the bill. 

Our Minnesota Association of REALTORS lobbyists will be attending and testifying at the conference committee meetings to make sure the final bill language does not contain the MID/Property tax elimination language.  However, if the bill language hurts homeowners, we’ll be asking West Savage Blog readers to take action again.

Just SOLD in the Oak Hills Neighborhood of Savage!!!!

This impressive Oak Hills home is now SOLD!

9210 Hillcrest Drive  - Savage  

There is a pending offer on this home boasting a full brick front with three car garage, arched covered entrance with a beveled glass door, and an impressive two-story foyer.  A formal living room and formal dining room adjoin the foyer.  The home features an open staircase, two-story great room, den with French doors, and a full granite kitchen with butler's pantry.  Enjoy hardwood floors, fresh paint and new window treatments with this home. 

Four spacious bedrooms occupy the second floor, and are connected with a catwalk overlooking the great room.  A master suite with French doors creates a dramatic entrance.  The master bedroom also features a luxury master bath with whirlpool tub, large walk-in closet and separate stool.  

The walkout basement is framed and ready for your finishing touches.

Located on a large cul-de-sac lot with pond views, this is home has all the amenities you could ever need in a home! 

Just SOLD by Chad & Sara!

1602 Norwood Circle  - Stately full-brick front 3BR 2BA 3 Car Garage home.  Updated flooring and terrific layout.  Perennial gardens, retaining walls, cul de sac lot!

 

April 2009 West Savage Housing Update

By Chad & Sara Huebener

 

Progress is certainly being made in our marketplace.   We can chalk it up to either the typical happenings in a spring market, or perhaps a more positive outlook on our economy….   regardless, what we are seeing is pretty positive stuff.

 

West Savage is seeing more listings come on the market, more pending transactions, and more closed sales.   Current listings and new listings have increased as those needing or wanting to sell take advantage of the increase in showing activity that spring market tends to bring.  And rightly so, as pending sales have increased 67% since last month and sold listings have tripled.   Prices, however, continue to fall, as foreclosures, short sales, and lengthy market times drive down prices.   

 

Savage as a whole has seen a modest overall increase in inventory.  Single family inventory has increased while townhouse inventory has dropped.  Perhaps this is due to the First-Time Homebuyer Tax Credit, as townhomes are rapidly being scooped off the market.  Scott County, too, is seeing a slight increase in inventory. 

Our West Savage absorption rate has dropped to 8.11 months.   This means that if zero new homes come on the market, it will take 8.11 months to sell the existing inventory.  Fortunately, this number is falling, as we are seeing signs of returning to a more balanced market.  Although we do not expect to see appreciation again for a number of years, signs of a balanced market on the horizon provide peace of mind for some.  We hope these indications prove to be correct.  

Just Listed (and SOLD)!

                                                        Just Listed & SOLD IN ONE DAY!

Photos simply do not do justice to this cozy, recently renovated home.  Amazing natural, original woodwork.  Framed entryways, carved stairwell banisters, raised millwork, crown moulding, carved doors, stained glass windows, hardwood floors and TWO sunny porches are just some of the exquisite features of this home.  Modern amenties such as a remodeled kitchen with 42" uppers, ceiling fans, surround sound speakers and two-car garage add modern convenience.  Relax on the front porch with new flooring and charming scalloped cornices.  Pressed tin window boxes and perennial gardens envelop the home in charm.    Offered at $169,700    

Real Estate "Skinny" - April 2009 **Watch the Video**

JUST SOLD! 50' of Spring Lake Lakeshore

 JUST SOLD! 

50' of Spring Lake lakeshore with sandy beach.  Enjoy the peace and quiet of this lake just minutes from the cities.  Over $70,000 in updates added since 2006.  New gutters & windows throughout! New granite countertops, granite sink, hardwood floors, & lighting package.  Two fireplaces (one gas, one wood-burning). New maintenance-free deck & retaining walls. 

Offered at $465,700

 

Proposed House Tax Bill would Eliminate Mortgage Interest Tax Deduction & "Double-Dip" on Income Used to Pay Property Taxes

This is very important legislation affecting homeowners.   Please help us by taking action against it!

April 20, 2009  - Minnesota Association of REALTORS (MNAR)

Today, the MN House of Rep. Tax Committee released a "delete all amendment" to HF2323 & added provisions that are negative for real estate in the Omnibus Tax Bill. Authored by DFL Rep Ann Lenczewski, it contains a number of tax law modifications that hurt all MN home owners. Please review & distribute this "Call to Action" to your clients, customers & friends/family.

HOUSE TAX BILL HURTS REAL ESTATE. The DFL House Tax Plan raises revenue by cutting a number of income tax deductions. The DFL House plan eliminates two major real estate tax deductions: the Mortgage Interest Deduction & Real Estate Property Taxes. The bill also eliminates provisions of the Relative Homestead Tax.

Elimination of Mortgage Interest Deduction (MID) a feature of the tax code since 1933, the MID helped numerous generations achieve the American Dream of owning a home. A significant public policy objective for decades, homeownership stabilizes families, neighborhoods and communities. The House DFL Tax Bill eliminates the MID for homeowners & replaces it with a "housing credit" for qualified homeowners. The maximum credit is $420, which is equal to 7% of up to $6,000 of mortgage interest paid during the taxable year, however, no credit is applied to the first $4,000 of interest paid. Therefore, a homeowner must pay at least $10,000 in MID in order to receive the full $420 credit. Example, if a homeowner has mortgage interest of $8,000 in the tax year, the credit equals $280. ($8,000-$4,000=$4,000X7%=$280.) This provision hurts young families disproportionately because mortgage debt loads are highest when people are establishing their households. This provision changes the financial plans numerous families have made when purchasing a home and increases the financial difficulties many are facing during this economic downturn. At a time when housing is finally getting a financial foothold why eliminate a tax provision that has helped millions of families achieve the "American Dream?"

Real Estate Property Tax Deductibility- People should not have to pay income taxes on property taxes they pay. This public policy provision has been included in the tax code since 1933 and allows taxpayers to deduct property taxes paid from their income. As an example, if you pay $2,000 in property taxes why should you also pay income taxes on that $2,000 - a version of double taxation? The House DFL Tax Bill eliminates the deductibility of real estate property taxes at a time when local property taxes continue to increase faster than Minnesotan's income. Taxing taxes, is in our opinion, poor public policy.

The MNAR has a long and respected position that government, at all levels, needs to "Live Within Your Means." Just like families sitting around the kitchen table trying to make ends meet, MN legislative body should not be adding to the long-term financial burden of MN homeowners. The House DFL Tax Bill penalizes families who have invested in the American Dream & provide for the backbone for stable communities.

ACTION REQUEST:

1) Please send the prewritten letter to your legislator. It is quick & easy & you can add your comments to the letter.

2) Send the link to this blog to family and friends . Let them know what is being proposed and give them the web address below to review the bill.

3) CALL your legislator about this tax bill. Let him/her know your concerns and how it will impact your clients, your family and your business. Let your Rep know that it is time for our elected officials to "LIVE WITHIN YOUR MEANS" by prioritizing spending and not raising taxes. Please find your legislator's contact information or use this link: http://www.leg.state.mn.us/leg/Districtfinder.asp

You can access the bill summary (48 pages) at http://www.house.leg.state.mn.us/hrd/bs/86/HF2323.html

Just SOLD by Chad & Sara!

4846 Dakota St. SE - Quaint 3BR charmer with Pottery Barn baths, maple kitchen, and two porches and fenced backyard! 

Just Listed by Chad & Sara! Craftsman-Style Luxury Home in Savage

Just Listed! 

Craftsman-style custom townhouse with 3BR, 3BA and 3 car garage.  Cherry woodwork, hardwood floors, built ins, vaulted ceilings, family room with gas fireplace, sunroom, screen porch, and maintenance-free deck with spiral staircase!  His & hers closets, luxury private master with tile floor and soaking tub.  Simply stunning!

Offered at $349,700