Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!usa-post Newsgroups: usa-today.real From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: real Mon, Mar 9 1992 Date: Mon, 9 Mar 92 05:46:24 EST Message-ID: 03-09 0000 DECISIONLINE: Real Estate USA TODAY Update March 9, 1992 Source: USA TODAY:Gannett National Information Network REAL-ESTATE MEASURES THREATENED: Partisan bickering threatening tax measures aimed at boosting home sales and lifting depressed property values has caused real-estate officials to raise the call for tax breaks. At stake is a proposed $5,000 tax credit for first-time home buyers and a move to restore some of the tax breaks for passive real estate losses that Congress cut in 1986. (For more, see special Deadlock package below.) MORTGAGE RATES INCREASE: Thirty-year, fixed-rate mortgages averaged 8.85% last week, an increase from 8.83% during the previous week, according to a survey released Friday by the Federal Home Loan Mortgage Corp. Last week's rates were the highest since the week ending Oct. 25, when they averaged 8.91%. One-year adjustable rate mortgages averaged 5.99%, up from 5.93% the previous week. JANUARY HOME SALES CLIMB: New home sales climbed 51% in January compared to rates from the same moth a year ago, reports the Commerce Department. Mortgage rates in January fell to an average 8.43% from 9.64%. New single-family houses sold at a seasonally adjusted annual rate of 612,000 in January, compared to 406,000 in 1991. FREDDIE MAC TO OFFER STOCK: Federal Home Loan Mortgage Corp. stock will be sold directly to the public for the first time, the federally sponsored housing company says. Freddie Mac's board approved issuing up to $750 million in preferred stock to be traded on the New York Stock Exchange. Before 1988, Freddie Mac shares could be owned and traded only by federally insured savings institutions. LOAN TAX RULES DIFFER: Homeowners who refinanced their mortgages should be aware that tax rules for deducting refinancing points are different from the points paid on loans used to buy homes. Points from refinanced mortgages are not deductible in full the year they are paid. Instead, points must be amortized, or spread, over the life of the new loan. One point is equal to 1% of the loan amount. ORIGINATION FEES NOT DEDUCTIBLE: Home loans often have points called loan-origination fees, which may not be deducted. For refinanced mortgages, a larger portion of the points can be deducted in the first year if the new loan is larger than the old one and the extra portion is used for home improvement. Points on home-buying loans are fully deductible in the year of the loan. TED TURNER MAY TRADE LAND: Television magnate Ted Turner says the he may possibly trade 1,080 acres of land he recently purchased to Montana to preserve the area. The land includes part of a buffalo jump in Ulm Pishkun State Park. BILL CALLS FOR SEAWALL REMOVAL: State-owned beaches in Hawaii would be cleared of illegal seawalls and fences under a bill before the House. The property owners currently adjoining the structures would have to pay the cost of removal, regardless of who built them. MAXIMUM RATE CHANGES: Profits from the sale of real estate are taxed a maximum rate of 28%, compared to 1990, in which long-term gains were considered as ordinary income, with a maximum rate of 33%. The top capital-gains rate is 28% and the top income-tax rate is 31% because of 1990 tax changes. SPECIAL PACKAGE ON DEADLOCK: CAPITAL GAINS, TAXES AT ISSUE: The tax break for first-time home buyers once seemed within reach. Economic worries brought support from Democrats, Republicans and President Bush. Now, issues such as the capital-gains cut and raising taxes on the wealthy have stalled measures aimed at helping the real-estate industry. The industry is held hostage, says Dorcas Helfant, president of the National Association of Realtors. REAL ESTATE GROUPS TAKE ACTION: The deadlock in Congress has prompted many in the real-estate industry to take the offensive. Coldwell Banker, the third-largest real-estate brokerage firm, has begun an advertising campaign urging people to lobby congressmen for the home buyer's tax credit. The National Association of Home Builders has planned a rally in Washington Tuesday to call for action. INDUSTRY HOPES FOR COMPROMISE: The Economic Growth Alliance, a coalition of real-estate groups, is running ads showing damage to local tax revenue caused by falling property values. Industry lobbyists are hoping the Democrats and Republicans will reach a compromise later this year, but some lawmakers are doubtful. "Both sides want things the other side can't possibly give," says Sen. Pete Domenici, R-N.M. (End of package.) Real Estate Editor: Christopher Goldthwaite. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM