All realtors looking to market themselves will be faced with this one question and it is: “why do we need you to buy you a home?” As someone who plans to survive on real estate business, you should be able to have a convincing answer. There is absolutely no doubt about the fact that if you, the realtor is really good at what you do, you will be an asset to anyone looking for a great deal.
You already know why someone looking for their dream house will not be able to do it well without you. The task however is to let your clients know it.
Let us break it down into sections so that you know which points to advertise more.
You are a realtor; this means you have legal certifications and approvals for doing the work you are in. Unlike other real estate agents or brokers who have no licensing, you will have contacts in arenas that matter. Also with the same knowledge comes the work ethics and moral conduct of a professional which may be missing in other sellers or brokers. If someone tries to buy or sell a home without your help, he or she may be in for some frauds.
In any field, it is imperative that you know it all about the field. Being in the real estate and working for years, you are sure to stack up on how the system works. You will know which areas are better in terms of proximity to medical facilities and other amenities as compared to others. Also as an insider you will know how things actually work. A buyer or a seller who is doing it for the first time will never know how much a property should cost. They will have to rely largely on guess work or the sources that do not work.
One can gather knowledge about a project by researching and finding facts but it will be of no use if they do not know how to implement it. You as a realtor will be able to gauge future market prospects based on what is happening today. This is not possible for a buyer or a seller who has not done this before. As a realtor, you can give them advice to wait till the market is stable and suitable enough to work for the price you are looking for.
Flipping real estate can be an exciting profession for anyone who is enthusiastic and loves challenges. It becomes thrilling, especially when one starts to earn big money on it. But with big money comes bigger taxes that have to be paid. If one is not careful with this, you will end up paying all your profits as taxes.
Principal Residence Exemption
Most of us are aware of this term and fell that selling houses could be tax free because of PRE. Before you get too zestful counting all the future money that you are going to make, let me tell you not every house you are going to buy will be called your principal residence.
This is the main problem, which will make you shell out a lot of money later as taxes if you are not careful.
Buying a property, renovating it and living in it for a bit does not make it qualify as your principal residence. Therefore, you can forget about trying to pass a property you bough and worked on as your principal residence.
Ways Around The Law
Though not every time but in some cases if you follow certain rules, you will be able to go tax free on some of the properties you sell. Here is a look at some of those:
- Hold On To the Property for an Year: If you hold on to a property for an year, it is called your primary property and may qualify as your main residence. This is not sure though as it always differs from case to case.
- Shift Into The House: To make everything sure, you will have to shift into the house and live there for two to three years to later sell it as your main residence.
- The Three Year Rule: Once you live in a property for three years, it does qualify as your principal residence. This was a common practice a well known Burnaby real estate agent, Eddie, preached.
You cannot have several principal residences and certainly cannot move every two to three years to a new house. If you are a businessman or businesswoman you will obviously want a fast turnaround of money without have to keep switching homes. The only option for you is to pay the taxes. The good part is that they have to be paid only on the profit and only after a certain amount of profit.
This differs from place to place and time to time.