An Update on Tax Changes in Real Estate

 For a certain segment of the market, selling a home is going to get a little more expensive. Here’s why.

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In the state of Washington, the real estate excise tax is currently made up of a 1.28% rate from the state and a .5% local tax to total 1.78%. That’s all about to change come January 1, 2020.

If you’re considering selling, especially if you have some higher-end real estate or commercial property, it’s going to affect you. It won’t have a huge impact on the typical seller below that, however.

The 1.78% excise tax is due at the time of sale and is separate from a capital gains tax.  On January 1, the total excise tax on homes in the $0 to $500,000 range will be 1.6%. From $500,000 to $1.5 million, that tax will remain the same at 1.78%. For homes valued in the $1.5 million to $3 million range, you will see a significant jump to 3.25%. For homes $3 million and above, the number is 3.5%. It’s based on the sale price of the home and is doubling for some property owners.

If you have any questions about this upcoming change or anything else related to real estate, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.

How to Handle Multiple Offers as a Seller

Are you overwhelmed by the offers you’re getting on your home? These five tips can help.

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Receiving multiple offers on your home can be an exciting—yet daunting—experience. If you aren’t sure how to choose the right offer, these five tips will help:

1. Be organized. It can be hard to keep track of every aspect of every offer you receive without any sort of system for comparing them side by side, so putting each offer into a spreadsheet or something similar is always a good idea. This way, you’ll never struggle to remember which offer is which.


2. Set a deadline. Make it clear to potential buyers that you will only accept offers up until a certain date. This will not only instill a sense of urgency, thereby making your listing more attractive, but it will also help you to keep moving forward with the home selling process.

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Always make sure a buyer is truly qualified to purchase your home before going under contract.

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3. Get to know potential buyers and their agents. You don’t need to know everything about every buyer by any means, but it’s good to at least understand their motivations. When you know what’s driving people to make an offer on your home in the first place, this will put you in a much stronger position when it comes time to negotiate price, terms, and conditions. Certain information about potential buyers may also sway your decision to accept (or reject) their offer.


4. Make sure the buyer is qualified and that their lender is competent. If a buyer is planning to use financing to purchase your home, as most buyers will, then you need to verify that they’re truly qualified to close.


5. Accept a backup offer. While following the steps we’ve already covered can help you to choose a buyer who’s unlikely to back out, unforeseen circumstances can arise. Therefore, it’s always a good idea to accept a backup offer. This way, you’ve got a “plan b” to fall back on.

If you have any other questions or would like more information, feel free to give us a call or send us an email. We look forward to hearing from you soon.