Massachusetts Home Buyer Guide

Massachusetts home buyers calculating the total cost of homeownership may need to remove the potential for tax breaks to repair or replace a septic system and/or for removal of lead paint. 

As part of a package of tax increases and the elimination of a variety of tax breaks, Massachusetts Governor, Deval Patrick, hopes to raise $1.9 billion annually in revenue. Two of his proposals are to eliminate the lead paint tax credit and the septic system repair / replacement credit. 

March has arrived, and we'll move the clocks forward an hour next week. It sounds like warmer temperatures and longer days are around the corner, but Massachusetts home buyers are wondering whether the spring real estate market will ever arrive.

The number of Massachusetts homes for sale has continued to decline over the past year. As of January 31, 2013, the inventory of single-family homes in the Bay State decreased 27.3 percent compared to January 2012, the Massachusetts Association of Realtors reported February 26, 2013.

Despite the lack of inventory, Massachusetts home buyers continue their quest for homes. 

Both single-family home sales and median price increased in January compared to January 2012, the Massachusetts Association of Realtors reported February 26, 2013.

Massachusetts real estate prices have increased four straight months, and single-family home sales have shown positive results in 19 straight months.

For those Massachusetts home buyers that have benefited or will benefit from purchasing a home at prices at or near the bottom of the real estate market, they may have to share their good fortune with the Commonwealth of Massachusetts, if a proposal by Governor Deval Patrick is enacted by the legislature.    

As part of a package of tax increases and the elimination of a variety of tax breaks, Governor Patrick hopes to raise $1.9 billion annually in revenue. One proposal is to eliminate the capital gains tax exemption on home sales.

Presently, Massachusetts follows federal tax law in exempting up to $500,000 in capital gains on the sale of homeowners primary residence. Governor Patrick's proposal to the eliminate capital gains exemption is in conjunction with raising the income tax from 5.25 percent to 6.25 percent, effectively raising the capital gains rate to 6.25 percent.  

For example, if a homeowner sells a home after livng in it for a number of years for a gain of $200,000, that homeowner will have $12,500 in tax liability. 

In real estate, there are dozens of industry terms that can be confusing or overwhelming.  Condex, LTV, ARM, Assessed vs. Appraise valued, FSBO, REO, Short Sale, BOM, etc.  It’s endless.

There are even many different ways to refer to real estate agents: agent, broker, realtor.  Are these terms all the same thing; can they be used interchangeably?  Here is some clarification on what each title means and what exactly is a Massachusetts Realtor.

The inventory of Massachusetts single-family homes as of December 31, 2012 decreased 28.1 percent from December 2011 (25,073 listings in 2011 to 18,021 listings in 2012), according to the Massachusetts Association of Realtors. 

More affordable prices, low mortgage interest rates and maybe some pent up demand resulted in Massachusetts home buyers signing many more purchase and sale agreements in 2012.

The inventory of single-family homes in Massachusetts as of the eond of November 2012 decreased 25.9 percent compared to November 2011, the MA Association of Realtors (MAR) reported December 27, 2012.

It is very likely that 2012 will be remembered as the year the real estate market turned around in Massachusetts. Not every community saw brisk home sales, but many Greater Boston Area and Eastern Massachusetts cities and towns saw good homes in good locations sell fast, many times within a few days. 

Both single-family and condominium pending home sales in Massachusetts increased in November compared to November 2011, marking the 19th straight month that pending home sales increased, the Massachusetts Association of Realtors (MAR) reported December 11, 2012. 

Pending home sales in Massachusetts soared in October, increasing nearly 36 percent compared to October 2011, The Massachusetts Association of REALTORS (MAR) reported November 12, 2012.