Homestead tax credit – are you getting yours?

Homestead Tax Credit
Homestead (infographic from census.gov)

It’s been eleven years since Maryland forced all qualifying homeowners to reapply for the Homestead Property Tax Credit.  Prior to the change in the application, applying for the Homestead Tax Credit was almost automatic for homeowners who claimed a primary residence.  However, many abused the program to get tax credits on non-principal residences by claiming multiple properties or rental properties as their primary residence.  The 2007 change was implemented to reexamine ownership, so as to stop the abuse of the property tax credit program.

The Homestead Property Tax Credit was created to assist homeowners with significant assessment increases on their principal residences.  The credit limits the amount of taxable assessments.  The state requires each county and municipality to limit taxable assessments to ten percent or less.  Most of Montgomery County is limited to the state cap of ten percent.  The Homestead Credit limits the property tax that the homeowner pays to the allowed limit.

According to the State Department of Assessments and Taxation website (dat.maryland.gov), the Homestead Property Tax Credit is granted if during the previous year: the property was not transferred to new ownership; there was no change in the zoning classification requested by the homeowner resulting in an increase value of the property; a substantial change did not occur in the use of the property; the previous assessment was not clearly erroneous; the dwelling must be the owner’s principal residence and the owner must have lived in it for at least six months of the year (including July 1 of the year for which the credit is applicable), unless the owner was temporarily unable to do so by reason of illness or need of special care.

A homeowner who vacates their home for major improvements, or plans to raze the home to build a new home may qualify for the Credit if the following two conditions are met: (1) the property was the homeowner’s principal residence for at least 3 full tax years immediately preceding the razing or starting the improvements; and (2) the building of the replacement home or the improvements must be completed within the next succeeding tax year after the tax year in which the razing or the substantial improvements were commenced.

Since 2007, many homeowners and home buyers have been unaware of the Homestead Tax Credit.  Additionally, since then, many homeowners who may qualify for the Credit did not reapply.  Many homeowners who purchased homes since then have also not applied for the Credit.  Besides being unaware of their eligibility for the Credit, they may not have understood the Homestead Tax Credit and the application process.  But this will change because of two bills passed by the Maryland General Assembly (HB990 Homestead Property Tax Credit Notification on Acquisition of Property, and HB305/SB158 Homestead Property Tax Credit Program Eligibility Awareness).

Beginning July 1st, the State Department of Assessments and Taxation is required to mail a notice about the Homestead Property Tax Credit to individuals who purchase a home.  And effective October 1st, the State Department of Assessments and Taxation is required to identify homeowners who may be eligible for the Homestead Property Tax Credit Program (but failed to apply) and provide information on applying for the Credit with each assessment notice. For more information about your Homestead Property Tax Credit eligibility status and application process, please visit the State Department of Assessments and Taxation website (dat.maryland.gov).

Copyright© Dan Krell
Google+
If you like this post, do not copy; instead please:
link to the article,
like it on Facebook
or Twitter.

Protected by Copyscape Web Plagiarism DetectorDisclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Independence, patriotism and homeownership

independence patriotism home ownership
Old Glory (photo from National Park Service nps.gov)

Let’s come together to celebrate our freedom and independence.  Having innate and inalienable liberties is the foundation of this country.  The concept of independence is abstract and usually expressed as intangible actions, such as the freedom from the tyranny of others.  However, home ownership has become an icon of freedom that is tangible and obtainable.

Last month I wrote about a few of the benefits of owning a home as part of the recognition of National Homeownership Month.  Besides being wealthier, home owners tend to be healthier and happier than their renter counterparts.  The history of owning land has been one of wealth and luxury.  Renting on the other hand has been associated transition, difficult times, and a hard life.  This can be traced back to the middle ages, when serfdom was associated with leasing.

How did owning a home become associated with the American Dream?  Richard Mize revealed the truth about the connection in 2013 (Who first dreamed the American dream of homeownership?; The Oklahoman; June 22, 2013; newsok.com).  Mize cites Eric John Abrahamson’s historical biography “Building Home: Howard F. Ahmanson and the Politics of the American Dream” (University of California Press) as the source of the story.  Abrahamson attributes the idea of home ownership as the American Dream to the restructuring of local savings and loans after the depression of 1896.

Building and loan institutions during the 1800’s certainly did not have the technology nor the interconnectedness our modern banking system has today.  In restructuring the financial system after the 1896 depression, local building and loans were organized to form the U.S. League of Local Building and Loan Associations.  The League’s motto was “The American Home: The Safe-Guard of American Liberties.”  According to Mize, this was promoted as the American Dream.

Abrahamson attributed the League’s first president, Seymour Dexter, with equating the idea of home ownership to liberty.  According to Abrahamson, Dexter felt that owning property was a duty.  Dexter believed Thomas Jefferson’s conviction that independent property-owning farmers would “sustain the independence and virtue of the citizenry and the health of the democracy.”  Dexter viewed the industrialization of America as a “challenge to democracy.”  The industrialized worker was much like the serf of the middle ages who rented a home near their job, and owed allegiance only to their employer (landlord), which was viewed as “politically corrupt.”  And to rebuild America of the 1890s, owning a home became portrayed as patriotic and a “civic virtue.”

In 2011, then president of the National Association of Realtors Ronald L. Phipps wrote (Home ownership matters; magazine.realtor; February 1st, 2011):

Our commitment to home ownership is not about simple self-interest. Rather it is about a larger purpose. Home ownership has been part of the American experience since the very first breath of the Republic.  Today, what we need to do as a nation is connect with our truth and our tradition: Home ownership matters.

It’s not only Realtors who promote home ownership but government as well.  Federal and local government programs exist to encourage home ownership through down payment assistance programs, low interest rate mortgages, and even home renovation programs.

As Seymour Dexter of the U.S. League of Local Building and Loan Associations realized, owning a home is an act of independence and patriotism.  It doesn’t only benefit you personally, but it also benefits your community and the economy.  The idea of independence transcends all ideology and can be exhibited by owning a home.

Copyright© Dan Krell
Google+
If you like this post, do not copy; instead please:
link to the article,
like it on facebook
or re-tweet.

Protected by Copyscape Web Plagiarism DetectorDisclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Basic home repair

basic home repair
Basic home repair tools (infographic from visual.ly)

I often preach about regular home maintenance.  However, home owners should also have basic home repair skills.  Basic repairs are those items that you can do safely, and usually don’t require a professional.  Basic home repair skills are sometimes useful as an emergency stopgap before the licensed contractor can make it to your home.

Basic home repair requires a few tools.  Keep a toolbox well stocked and know where it is so you can easily find it when necessary.  Besides the standard hammer, Philips and flathead screwdriver, your toolbox will need more items depending on your skill level.  If you’re in doubt about your ability to make a basic home repair, call a licensed contractor (you can do more damage if you don’t know what you’re doing).  As a precaution and in case of emergency, you should know where the emergency shutoffs are in your home for water, electric and gas.

One of the first repair skills that I learned as a home owner is how to “snake a drain.”  Bathroom drains, specifically, get clogged with hair and soap.  Chemical products are a common solution, however you should always follow the directions and read the “cautions and dangers.”  Chemicals don’t always work well, however.  If used improperly, chemical drain products can also damage basins and pipes.  Following the instructions, you can easily clear most clogs with a drain snake.  A small drain snake should be part of your tool box. These are cheap to purchase and readily available at the hardware store.

Have you ever needed to change your door locks quickly?  I have, once when a lock failed (the mechanism broke), and another time when someone stole our keys.  Although most locks can be changed out easily with a screwdriver, specialized locks require a locksmith.  Most locksets are designed as components that easily install. However, you should note that standards change over time, so make sure the lockset you purchase is the same size as the one being replaced.

Patching drywall is one of those repairs that is so basic that you can find “how-to” tutorials everywhere.  Basic drywall patching requires a few basic tools, such as a “spackling tool,” utility knife, sand paper and spackle.  Spackling tiny pinholes is easy. However, a larger hole may require some time for the repair as well as the clean-up.  Damage to large areas of drywall will most likely require sections to be replaced.

Can’t find the leak from your sink or tub?  There’s a good chance it’s coming from water that is seeping through old caulking.  Caulk is used as a sealant in plumbing applications.  It seals the fixtures and perimeter of sinks, tubs and shower stalls, which prevents water from trickling through.  As it ages, caulk shrinks and can become brittle, which allows water penetration and leaking.  A tube of caulk should be in your toolbox in case you need it for an emergency repair.  You don’t need a large caulking gun, as caulk is available in many forms, such as squeezable tubes and even tape.

Plastic sheathing and duct tape are both good to have in your toolbox in case of an emergency.  Duct tape, specifically, has many uses and is widely used as an adhesive and sealant.  These two items are useful as a short-term repair for broken windows and doors.  Plastic sheathing and duct tape can easily cover the affected areas until they are replaced, as well as help maintain cooling or heating in the interim.

 

Copyright© Dan Krell
Google+
If you like this post, do not copy; instead please:
link to the article,
like it on facebook
or re-tweet.

Protected by Copyscape Web Plagiarism DetectorDisclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Specialty rooms for all interests

specialty rooms
Home improvement spending is increasing to include specialty rooms (infographic from census.gov)

Prior to the Great Recession, home owner spending for remodeling and renovations was very strong.  Besides remodeling the kitchen and bathrooms, many home owners also created specialty rooms (also known as special function rooms) in their homes.  Specialty rooms such as home theaters and media rooms were not just trendy because they were cool to have in the house, but they also added resale value.  According to Kermit Baker writing for Harvard’s Joint Center for Housing Studies, post-recession home remodeling spending dropped off by as much as 28 percent between 2007 and 2011.  That spending decrease meant that while home owners focused on saving and paying their mortgages, specialty rooms were no longer a necessity.

The return of the specialty room can be measured by the increased home remodeling spending over the past few years.  Specialty rooms are increasingly in demand.  The recent LIRA press release projects that home remodeling will remain strong at least through 2019.  Chris Herbert, Managing Director of the Joint Center for Housing Studies stated:

“Strengthening employment conditions and rising home values are encouraging homeowners to make greater investments in their homes…Upward trends in retail sales of building materials and the growing number of remodeling permits indicate that homeowners are doing more—and larger—improvement projects.”

Prior to the Great Recession, specialty rooms were a must for home owners.  However, many of these specialty rooms were primarily added for display and resale.  Home owners have since moved away from the large gaudy specialty room and are opting for more practical spaces focused on enjoyment and function.

Several years ago, panic rooms were in demand for protection.  It wasn’t just to protect from a home invasion, as portrayed in the movie “Panic Room,” but also to  offer shelter from severe weather.   FEMA even provides information on creating a safe room in your home.

Yes, specialty rooms are becoming popular again, but not in the way they were prior to the recession.  According to the 2017 AIA Home Design Trends Survey (aia.org), creating an outdoor living area is the currently the most popular specialty room today.  The outdoor living area is a way to extend indoor space and amenities (such as kitchen and home entertainment) to your back yard or roof top deck.

But home owners are opting for other specialty rooms too.  Building a fabulous mudroom comes in second in the AIA Home Design Trends Survey.  No longer that meager alcove separating the garage and kitchen, the mudroom has become a multi-purpose functional suite.  Obvious coat hooks, benches, and shoe cubicles are standard.  But mudrooms have become larger to accommodate storage units and desks, typically with high-end flooring and moldings.

Other specialty rooms mentioned in AIA’s survey include the home office and in-law suite.  However, other types of specialty rooms that are popular include fitness rooms and wine cellars.

As the economy improves, home owners have more money to spend on their passions.  Currently, there is a trend to build specialty rooms to help home owners pursue hobbies and talents.  Hobbyists are creating spaces for their collections and interests.  Many home owners are designing dedicated rooms as art studios.  Music lovers and musicians are finding that technology has made the music listening room and recording studio easy and affordable to create in their homes.

Over time, the home has evolved from a Spartan shelter to a space where we relax and express our personalities.  It is likely that specialty rooms will continue to evolve based the home owner’s lifestyle, finances, as well as technology.  Specialty rooms will also vary based on societal norms (consider formal dining and living rooms) and economic conditions.

Copyright© Dan Krell
Google+
If you like this post, do not copy; instead please:
link to the article,
like it on facebook
or re-tweet.

Protected by Copyscape Web Plagiarism DetectorDisclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.

Air conditioning maintenance

air conditioning
Home Cooling (infographic from energy.gov)

Did you know that the first commercial application of air conditioning was in 1902?  And yet, residential central A/C didn’t come into its own until the 1960’s.  According to the US Department of Energy’s History of Air Conditioning, A/C use skyrocketed in the 1970’s.  Since then, systems have become more efficient, such that new air conditioners use fifty percent less energy than units from the 1990’s.  Additionally, new technologies are making A/C units increasingly environmentally friendly.  New developments in air conditioning include non-vapor compression technology, which will be fifty percent more efficient and doesn’t use Hydrofluorocarbons (energy.gov).

Summer is around the corner.  But I would venture to say that many of you already have your air conditioning running.  We take for granted that our home’s air conditioning runs without fail.  But proactive care of your A/C unit will keep it running efficiently while you stay cool through the hottest summer days.  Here are some air conditioning maintenance tips from the US Department of Energy (energy.gov):

Regular maintenance of your home’s air conditioning system will ensure air flow.  Regularly changing air filters can keep your system clean and keep the air flowing.  A clean filter can reduce energy consumption by five to fifteen percent.  Filter change requirements can vary from home to home, due to home conditions.

Over time, the A/C unit’s coils can become dirty, which will reduce its efficiency.  Dirt on the coils can reduce airflow and prevent it from absorbing heat.  The outside condenser coils will likely become dirty from being exposed to the elements.  It’s recommended that the area around the outdoor unit be clear of debris, leaves, and have about two feet of clearance for ideal airflow.  Make sure that the air conditioner condenser drains are not blocked.  A clogged drain can create excess humidity, which can create conditions for mold growth in basements and utility closets.

Window A/C units require maintenance too.  You should inspect the seal between the unit and the window to ensure there are no air leaks.  Window A/C units should be covered during the winter to prevent dirt and debris from penetrating the unit.

Some maintenance requires a qualified HVAC technician.  If you hire a HVAC tech to clean and service your air conditioning, make sure they have a current HVAC license.  Hiring a professional doesn’t have to be expensive, as many HVAC companies run maintenance specials this time of year.  Besides checking the refrigerant in the system, the tech will run a number of diagnostics as well as clean the system if needed.  They will also make necessary repairs, such as sealing leaks.

Air conditioning maintenance assistance programs

If you’re on a modest income and cannot afford to service or upgrade your air conditioning, you may qualify for Montgomery County’s Homeowner Energy Efficiency Program.  The program is in partnership with Habitat for Humanity Metro Maryland, Inc to assess applicants’ eligibility and identify their needs.  According to a Tuesday county press release, “homeowners benefitting from the program will receive free energy-efficiency upgrades to their home which may include attic insulation, upgraded furnace and air conditioning units, water heater replacement, LED light bulbs, a solar-powered attic fan, a programmable thermostat and new appliances.”

The program is open to all Montgomery County homeowners.  Eligibility requirements include; owning and occupying the Montgomery County home for which they are requesting services; they must be a PEPCO customer; and meet income criteria.  For more information see the program website (habitatmm.org/montgomery-county-energy-efficiency-program).

Copyright© Dan Krell
Google+
If you like this post, do not copy; instead please:
link to the article,
like it on facebook
or re-tweet.

Protected by Copyscape Web Plagiarism DetectorDisclaimer. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.