Homes of the Future: What’s Hot and What’s Not

Homes of the Future: What’s Hot and What’s Not
By Chad D. Collins

Are you planning to move to a new home in the next few years? Thinking about renovating your current home so it’s more appealing to potential buyers when you do decide to move on? Or maybe you just want to change your space to follow the latest trends?

Whatever your plans for your existing or future home, research from the National Association of Home Builders and Better Homes and Gardens magazine shows what features and floor plans will be popular over the next few years.
According to an NAHB survey of home builders on their expectations for homes in 2015, smaller homes with lower prices and more green features will be the predominant force in the marketplace.

As the average size of new single-family homes continues to decline to 2,377 square feet from a peak of 2,521 in 2007, floor plans are focusing on frequently-used rooms. More than half of the builders surveyed said the size of the family room will increase, while the formal living room, entry foyer and dining room are expected to decrease or disappear.

Other features that builders predict are highly likely to be included in the average new home of 2015 include a walk-in closet in the master bedroom; a laundry room; ceiling fans; a master bedroom on the first floor in homes with two stories; and a two-car garage.

Nearly 70 percent of the respondents said that homes will be greener, and about one-third expect them to have more features related to technology.

The most common green features in 2015’s new homes will be low-E windows; engineered wood beams, joists or trusses; water-efficient features such as dual-flush toilets or low-flow faucets; and an Energy Star rating for the whole house.
The families who will be looking to move into new or renovated homes have high expectations for their new space as well.

A December 2010 survey of Better Homes and Garden readers who consider themselves prospective home buyers or who are planning a major improvement to their home indicated that home buyers don’t want any “wasted space” in their next home and they are seeking significant value for the money they spend.

Eighty-nine percent of consumers want high-efficiency heating and cooling in their next home, 85 percent want high-efficiency appliances, and 78 percent want upgraded features and fixtures such as granite countertops, wood flooring, faucets and lighting fixtures.

Efficient use of space also ranks highly in consumers’ desires. The top-ranked living spaces include a separate laundry room; additional storage space; walk-in closets or built-ins; a home office space, workspace or family computing center; and everyday eating space in or close to the kitchen.

Homeownership Can Bring Big Savings at Tax Time

Homeownership Can Bring Big Savings at Tax Time

Chad D. Collins

As the April 18 federal income tax filing deadline approaches, millions of Americans are sitting down and sorting through dozens of forms to determine how much money they owe Uncle Sam – or, how much of a refund they will get this year. One of those forms, the Mortgage Interest Statement Form 1098, can mean big savings for home owners at tax time.

Form 1098, which home owners receive from their lenders, shows the total amount of home mortgage interest paid during the year. Home owners who itemize their federal income tax deductions can deduct 100 percent of their mortgage interest payments on a first or second home for up to $1 million of mortgage debt. They can also deduct the interest paid on up to $100,000 of home equity loans.

For most home owners, this means they can deduct ALL of the mortgage interest they’ve paid on their home each year.

The ability to deduct home mortgage and home equity loan interest isn’t the only tax benefit for home owners.

The three most important sources of tax savings for home owners are:

• Deductions for mortgage interest
• Deductions for real estate taxes
• The capital gains exclusion for the sale of a principal residence

Home owners are also able to deduct the state and local real estate taxes they pay each year on an owner-occupied home.

When it is time to sell a home, in many cases home owners don’t have to pay capital gains tax on the profit from the sale. Under present law, married couples who have owned and occupied their principal residence for at least two of the past five years do not have to pay any taxes on the first $500,000 in profits from the sale of their home. Single filers earn up to $250,000 tax free.

Another deduction home owners may be able to take is for mortgage insurance premiums. Generally, people who purchase a home without putting 20 percent down have to buy mortgage insurance, and those premiums can also be deducted from taxable income.

Even home owners who don’t use the home as their principal residence and rent it out may be able enjoy some tax benefits, including interest and depreciation deductions.

Buying a home offers tax savings that can add up to tens of thousands of dollars over several years. Home owners rely on the mortgage interest deduction each year to help offset the costs of homeownership and prospective buyers take the deduction into consideration when choosing homeownership over renting.

But the mortgage interest deduction, which has been included in the tax code for about 100 years, is in danger. A national deficit commission has proposed reducing or eliminating the deduction as part of a restructuring of the tax code.