DEAR BOB: About three years ago, I bought a tenancy-in-common (TIC) in a six-unit apartment building. The building is very “upscale.” But the owner couldn’t qualify for a condo conversion due to lack of enough parking spaces. I knew there was one master mortgage on the building and I was obligated to pay my share of the mortgage and expenses. We all get along great, everyone pays his or her share every month, and there are no problems. However, now I need to sell my TIC because I am moving to Los Angeles. But I am having great difficulty finding a realty agent to list and sell my TIC. I even tried advertising “for sale by owner” in the newspaper. Any suggestions? –Wendy R.
DEAR WENDY: A TIC is a poor substitute for a condominium conversion. I fully understand all the reasons a property owner would create a TIC instead of a condo.
Purchase Bob Bruss reports online.
But the result is a very constrained TIC resale market. Many real estate brokerages refuse to accept TIC listings because of the difficulty financing such resales. Check the newspaper classified ads and try to find a local brokerage that specializes in sales of TIC units.
$500,000 HOME-SALE TAX EXEMPTION ONLY AVAILABLE IN YEAR OF SPOUSE’S DEATH
DEAR BOB: My husband passed away on Feb. 1, 2006. You mentioned in a recent article that surviving spouses need not rush to sell their principal residence within the same year of the spouse’s death. I plan to sell my house in early 2007 so I can move back to Michigan to be near my family. You said the surviving spouse receives a new stepped-up basis on at least 50 percent of a home’s market value (100 percent in community property states). As a surviving spouse who inherited my late husband’s half of our home, when should I get this evaluation made? Also, since my husband passed away in February 2006, can I still file a joint tax return for 2007 to claim a $500,000 home-sale tax exemption? –Judy L.
DEAR JUDY: You should obtain evidence now of the home’s market value as of the date of your husband’s death. A professional appraisal is best.
You can only file a joint income tax return in the year of your husband death. That is 2006 in your situation. No, you cannot file a joint tax return for 2007, nor can you claim a $500,000 principal residence sale tax exemption later than Dec. 31, 2006. Please consult your personal tax adviser to clarify your situation.
WHERE TO OBTAIN A HOME EQUITY LINE OF CREDIT
DEAR BOB: You often recommend homeowners should have a substantial home equity line of credit just in case of an emergency need for cash. Where can I obtain such a credit line? –Karl A
DEAR KARL: Virtually every bank offers home equity lines of credit, known as a HELOC. If you have good income and good credit, you should pay an adjustable rate of interest at the prime rate or lower. The annual fee is usually $50. You only pay interest when you use part or all the money available from your HELOC.
The new Robert Bruss special report, “Pros and Cons of Fast and Slow House Flipping for Big Profits,” is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.
(For more information on Bob Bruss publications, visit his
Real Estate Center).