Real Estate Solutions

Pam Silverman

When It Is Time To Sell
Decisions Reverse Mortgage Alternatives Sell and Move Out Disclosures Disclosures, Disclosures, Disclosures Taxes More Taxes
Where To Move To So How Do You Decide When Purchasing Holding Title to Real Estate        

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Sometime in a Senior’s life, a decision usually must be made, whether to stay in their home (as most Seniors want to do), or to sell and go into a new type of housing that will meet their new needs and requirements.

The first thing you need to do is to ask yourself the following questions:

1. Why am I (we) even considering moving from our lovely home?;

2. If you are considering selling, where are you going to move to ( type of housing and location of the housing); and

3. If you were to sell, what are the capital gains consequences of selling?

Lets deal with the first question only in this article.

If your reasons for moving are because of too many maintenance problems, perhaps just hiring a gardener or contractor could solve this so you can stay in your home.

Does your home have two stories, with living area on one floor and bedrooms on the other, and the stairs are too much for you? Perhaps a railing type chair elevator could solve the problem.

Often the reasons for looking at moving are for physical &/or medical problems, so you need to consider a new type of residence facility where you can get medical assistance.

Hear are some guidelines to assist you in making the decision. Look at the “benefits” in your home, i.e., location in town, shopping, weather, community spirit, friends, size of house, yard, pool, views, garden, etc.

You need to make 3 lists. If you are husband and wife, make your lists separately, then compare them, as you might be surprised at how much they differ!

1. What were the “benefits” that you obtained when you purchased your present home?

2. Which of these “benefits” do you no longer need? This now leaves you with the present benefits your home provides (add in any remodeling you have done).

3. What benefits do you want or need in new housing?

So lets assume that your list of “present benefits” meets your current needs (and most likely your home is on one level).

But, you say “I need more money, such as monthly income or money to pay to put on a new roof that costs $10,000?”

Obviously, you can sell, but then you have to move out of your home, and with the high appreciation of home values in Ventura, you might even have to pay some capital gains tax if you sell! Or you could get a “home equity” loan from the bank, but to get it, you have to have income to qualify, and you have to make monthly payments!

So how can you get out some of the “lazy equity,” sitting in your home, and still stay in your home and use that equity to get some money?

The answer: a Reverse Mortgage. Reverse Mortgages are NOT a Panacea; they are just an Option, but one that should be looked at.

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years  Back To The Top


If your primary concern is to stay in your home, and the problem is lack of money, then you should at least look at reverse mortgages. They have advantages and disadvantages, and you need to know about both. What you see in the newspapers and on TV, often by passé movie stars, tells you all about the advantages only. What you hear is: “Wouldn’t you like to stay in your home and have the bank pay you to do this?” By itself, this is a true statement, but lets look at the whole picture!

The usual type of mortgage, such as a home equity loan, is sometimes called a “forward mortgage.” You have to have enough income to qualify to get it, the bank gives you the money now, but then you have to make payments back to them each month, with interest.

A reverse mortgage is just the opposite! There is no “income” qualification to get the mortgage, and you don’t have to make monthly payments to the lender. They pay you, either each month, or give you a line of credit, or a lump sum, or a combination of these. This money you receive is secured by a note and deed of trust on your home. The balance on the loan goes up each time you receive some money. You don’t have to pay off the loan until you sell, move or die! And even if the loan balance at that time happens to be higher in amount than the home is worth, you have no personal liability for that difference.

Requirements: Age 62 or over, own and occupy your home as your primary residence, and your home should be free and clear of any loans, or with a small balance that the reverse mortgage lender will pay off and start your reverse mortgage balance at that level.

There is no income tax due, as what you receive are just loan proceeds. You can’t deduct any interest, because you are not currently paying interest, it is just accruing in the loan balance, and presumably would then all be deductible when you pay off the loan.

How much can I get? This is based on the amount of equity in your home and your age. The more the equity and the older you are, the more the monthly payment you will receive.

You still own your home, you get all its appreciation, and you still have to maintain it, pay the property taxes, home insurance, etc. If at the time you sell, move or die, if the sales price is more than the reverse mortgage balance, this equity is all yours, or your heirs.

As I said, reverse mortgages are an option, not a panacea. To have the bank pay you money each month and be able to stay in your home sounds great, and is, but there are some disadvantages also.

First, you are paying compound interest, because each month that you receive a payment, there is interest due on the balance, and that balance includes both the payments you received plus accruing interest.

Second, there are large “upfront” fees that could amount to $12,000 to $15,000. You can pay these in cash, or the lender will let you start your reverse mortgage loan balance with the amount of these fees.

Remember, you can talk to your bank or a loan officer specializing in Reverse Mortgages about a Reverse Mortgage, but before they can commit you to a loan, you have to talk to a fully independent reverse mortgage counselor, to be sure you understand what you are getting into. These counselors are usually persons trained by AARP and have absolutely nothing to do with any lender who would make the actual reverse mortgage loan.

You should figure that you are going to stay in your home for at least five years, in order to amortize the upfront costs.

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years Back To The Top


One other option, to be able to stay in your home, is for Mom and Dad to sell their home, for fair market value, to Junior and his wife, and lease it back on a long term lease. An appraisal is made to determine market value, that is, an outside qualified opinion of market value, and the lease can usually be for as long as agreed upon.

This is called an “installment sale,” i.e., Junior and his wife can buy the home for nothing down, or whatever is agreed upon, and a note is created with an interest rate, which cannot be less than a minimum set by the Federal Government, and the note is secured by the property. The monthly payments to the parents provide them with income, and they can take advantage of their $500,000 capital gains exemption. As the parents receive each payment, part is taxed as interest, part is tax free, and part may be taxed as capital gain (if the gain exceeds the exemption amount).

For the children, to them, the home is just an investment property, they can take the usual investment property deductions, and they have “good” tenants!

The loan payments may offset the rent payment, but it is important to do two separate checks.

Under Proposition 58, since the property went from parents to their children, the home will not be reassessed for property taxes. There may be a $1 million limit on this.

If this is something you want to do, check with the County Assessor’s office on the current status and wording of Prop. 58, and with your accountant, to be sure you do it correctly. IRS is more likely to check this type of sale to see if the sales price and rental amount are at fair market, as the property is going “within” the family.

Another option to look at is to move out of your home and rent it out. You may do this to get income from it, or you want to do it because you may want to move back into it in the future, especially if your plans change. This latter might be a good idea if you are going to move to a new location, or even a place you grew up in, or where your children are now living, because if you sold your home now, and then later decided you wanted to come back here, it’s probable that the values of homes here would have risen, and you couldn’t afford to buy here again.

If you rent your home out for an extended period of time, your accountant may change its character by making it an “investment” property, so that you can take all the investment property deductions. Even if you do this, you can still move back into your home and establish it as your primary residence for tax purposes. However, this will lower the amount of your tax basis, so if you then decide to sell, check with your accountant first, to see how much capital gain you would have, and to be sure you meet all the requirements to get the $250,000 or $500,000 exemption.

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


If you haven’t sold a home in the last 5-10 years, the world of real estate has changed dramatically. Years ago, possibly when you purchased your home, the legal status was “buyer beware.” Today, it is “Seller Beware!” Each year, the process of selling gets more complicated, requires more disclosures, and adds more legal liability for both the Seller and the Realtor.

Lets look first at the “process” involved in selling your home.

First, you need to fix it up, especially the front of the house. When buyers first arrive at your house, they see the front of the house and the yard. If they get a negative emotional reaction at that point, they may not even go into your home. New paint on the inside, as well as the outside, can make a big difference.

After all, if you were looking to buy a home, wouldn't you prefer to see a clean, fresh, neat home? Ask an Accredited Staging Professional like Pam Silverman what changes you should make. This may only require getting rid of some excess furniture so the home feels larger, or they may recommend storing your furniture and staging the house. After all, you want buyers to come into your home, sit down, feel comfortable and have a positive emotional feeling, so they will say “lets buy this home!”

Second, use a REALTOR. All real estate agents are either brokers or salespersons. They must have a license from the State of California and follow its real estate laws. However, all licensees are NOT REALTORS! To be a REALTOR, the licensee must be a member of the local board of REALTORS (in Simi Valley, the Simi Valley/Moorpark Association of REALTORS), the California Association of REALTORS and the National Association of REALTORS.

What difference does this make? A REALTOR must follow a Code of Ethics and can be brought before the local board of Realtors Ethics Committee for discipline. For a non-REALTOR, i.e., just a licensee, your only choice is to go to the State Division of Real Estate, which could take months and result in no discipline. Pam Silverman is a Realtor, A member of NAR, CAR Simi Valley/Moorpark Association of Realtors plus the Simi Valley/Moorpark Multiple Listing Service utilizing the Ventura Regional Data Service and the Southland Regional Association of Realtors Multiple Listing Service utilizing Tempo.

Third, use a “good” REALTOR, one who: explains the current market to you and provides you with a Comparable Market Analysis that shows you what comparable homes have sold for, as their basis for pricing your home.
One who takes the time to explain all the many forms we will go over later. The understanding and filling out of these forms could take two hours! Pam Silverman has been an award winning full-time Realtor serving the Simi Valley area Since 1979.

Work only with a REALTOR with whom you are compatible and that you trust. After all, you are placing in their hands, probably the largest asset you have, and you want to know that they are going to do it right, and for your best interest!

Work with a REALTOR who “counsels “ with you regarding all the aspects of selling. The “counseling” approach is different than “consulting.” In the latter, you go to a professional, such as a doctor, accountant or engineer, present your problem, and they give you the solution. In “counseling,” the REALTOR sits down with you and determines how he/she can assist you to best meet YOUR needs and wants. Pam Silverman has been awarded the Seniors Real Estate Specialist designation.

They won’t “tell you what to do,” but will ask you questions, give you information you don’t have, talk about what benefits you are looking for in your new type of housing. They will assist you in making the best decision for YOU. This may include whether to stay in your home, or to move, and where to move to.

Your REALTOR should do a good job of marketing your home to other REALTORS and to the public, and work to represent your best interest. This means, that your REALTOR may not sell your home, because if they are both the listing agent and the selling agent (for the buyer), a conflict of interest may occur.

Remember, although the listing you sign will be with the company for whom your agent works, but the person you are counting on is your agent. That person will do the job for you” After all, as a Senior, you want to know how much your agent cares about you, before you care about how much they know!

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


If you purchased your home in the 1970s, or before, the legal world for sellers was different. It was known as “buyer beware.” The Seller didn’t have to tell the buyer anything about the house. Today, the legal world is just the opposite: its “seller beware,” and most law suits relating to real estate today, are for “lack of disclosure!” So the way to look at filling out all the disclosure forms is: “if in doubt, disclose.”

If you were to end up in court, whether something that was not disclosed was “material,” would be decided by the judge, and it is amazing how many “things” become “material” to a buyer when they decide to sue, and today, that poor buyer, who paid two million dollars for your house, becomes the most likely one to win in court, against these rich home sellers!

Remember, any and all disclosures, made by you, the REALTORS, and by professional inspectors, do not change the house in any way. It’s still the same house you want to sell. It may affect the sales price, but often the work that the inspectors find, that already exists in the house, and that may have occurred while you owned it, just means it is work that you probably should have done in the past.

Today, a buyer will most probably want the following inspections made:
Wood Destroying Organisms (sometimes called “termite inspections, but they contain more than just information regarding termites), Contractor Inspection (preferably by a licensed contractor), and possibly additional inspections, either because the first two inspectors suggest it, or because of additional items, such as a Structural Engineer, Roof Inspection, Pool Inspection, Chimney Inspection, and a Septic Tank & System Inspection.

Do you want the buyer to have all these inspections? Yes, Yes, Yes! Why, because anything they find and put into their written report, protects you, as the buyer now knows of all these items, and can’t say that you forgot to put it into your disclosure.

Be sure your Realtor gets a signed and dated “Receipt for Documents” with all these reports listed, signed by the buyer, to prove that they received them.

Do you have to pay for any work in these reports? Probably not, but they may enter into some negotiation on the final sales price. Usually you will work out a dollar solution, rather than have the work done by you, unless its minor, as you may have a good person do the work, but the City or County building inspector, or the contractor inspector that comes back to check the work, may not like how it was done. Or the buyer’s contractor may not like the work either. Its sometimes possible that you could spend $50-100,000 dollars to do repairs, and then have the buyer come in and tear down part of all of the house!

One other option, you might want to consider and your Realtor may suggest, and that is to have you order these reports before you put your house on the market, and pay for the reports yourself. The reports could easily cost $500 or more. So why do this? If yours is an older house, and your Realtor feels that the reports are probably going to show some work to be done, if you give the buyer the reports before they make their offer, then the price they offer, and any counter offering to a final price, should then include all that is in the reports. The buyer still has the right to get additional reports if they want, but if you use qualified inspectors, the buyer is likely to accept your reports. If you don’t do reports beforehand, and give them to the buyer beforehand, then the buyer gets the inspectors they want, and then after having made an offer, want to do lots of price negotiation, based on the “guesstimates” of their inspectors, who may overly favor their buyer in their guesstimates of costs.

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


Your Realtor will ask you to fill out many forms, some required by the State of California, some by the Federal Government, and some “supplemental” forms to help you think of items that are not on the other forms. I as said before, if in doubt, “disclose!” Most law suits today are for lack of disclosure by a Seller. Remember, disclosing does not change your home. If your disclosure indicates significant problems, it may reduce the net sales price of your home, but that’s better than a law suit where you may pay, just the lawyer, $50,000 for his/her fees, over and beyond any judgments.

The first form is the “Real Estate Transfer Disclosure Statement,” a mandatory form. It tells the buyer what is in the home, and any problems, faults and any repairs or modifications. As part of this form, both the listing agent and the selling agent must also do a written “inspection” of the property.

The second form is called “Supplement to The Real Estate Transfer Disclosure Statement.” Answer all these questions, including any reports that you have, to help you do a more thorough job of disclosure.

A third form is “Disclosure Regarding Real Estate Agency Relationship.” This is to tell you how you want to work with your agent. Be sure and read it thoroughly so that you understand if your Realtor is working for you only, or for others as well. Remember, that the “Broker” referred to here is the broker that your salesperson is working for, not the salesperson or the individual office.

A fourth form will be one, that may have a different name with different companies, but what is says is that you have “strapped your water heater” and have in place, “working smoke detectors,” all of which meet the State of California requirements.

A fifth form is “Disclosure of Information on Lead-Based Paint and Lead-Based Paint Hazards.” This must be filled out if your home was built prior to 1978, but since some paints left over from 1978 or before could have been used after 1978, best to fill it out anyway.

There is a booklet put out by the State of California which both Seller and Buyer must receive. It explains many of the different types of “residential environmental hazards” that a home may have, or could have in the future. It is called a “Combined Hazards Book.” At the back of the booklet is a form called “Residential Earthquake Hazards Report” which you must fill out if your home was built before 1960. Again, even if it was built later, I’d suggest filling it out. The booklet has all the information in it you need to fill out the form. If your home happens to have concrete block in its foundation or walls, the buyer must also receive another booklet which is for commercial properties.

There will be a form by the State of California where you state whether you are or are not a California Resident, and one by the Federal Government to indicate if you are a citizen. The purpose of these forms is so that the government agencies can collect some money on your “capital gain” in your property before you skip out of the State or out of the country.

There will probably be many more forms, especially from the larger real estate companies. Some of these may included Water District requirements, Standard Disclosure and Disclaimer information, a special advisory regarding Marin County disclosures, “tree” disclosures, and mold or water damage disclosures (including insurance claims).

Always better to “over” disclose, to prevent possible law suits that could cost you time, money and emotional distress.

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


First, let’s look at the tax laws that were repealed and no longer apply. You will probably remember these, but forget them now!

The first was called an “IRS Section 1034 Rollover.” If you sold your old home and purchased a new one at a higher price, within two years, you paid no capital gains tax at that time. The capital gain was not wiped out, it was just deferred until some future time when you sold your home and did not purchase a higher priced home.

The second, was one where, if you were over 55 years in age, you could get $125,000 of capital gain excluded when you sold your old home, if you had lived and owned that home as your principal residence for 3 out of the last 5 years. You could do this only once in a lifetime, and if you did not use it and you married a person who had used it, you could no longer use it! The “tainted spouse” syndrome is gone!

The new exclusion, I would call universal! There are no age restrictions, you do not have to re-purchase a home, but if you do, it makes no difference whether you go up or down in price, and you can use the new exclusion every 2 years, as long as you follow all the requirements of the new tax law.

So what are these requirements?
There are three tests: Ownership, Use and Waiting Period.

For the $250,000 exclusion of capital gains:
1. You must has owned the residence for periods aggregating at least 2 years of the 5 year period ending on the date of sale;
2. You must have used the property as your principal residence for periods aggregating at least 2 years of the 5 year period ending on the date of sale;
3. You must not have utilized this exclusion for any sale during the preceding 2 year period.

For the $500,000 exclusion of capital gains, only for married couples, filing jointly:
1. Either you or your spouse must satisfy the same ownership test, as above. You can still claim the exclusion even if only one of you owns the residence;
2. Both you and your spouse must satisfy the use test, so each of you must have used the property as your principal residence for 2 years of the 5 year period ending on the date of sale;
3. You cannot claim this exclusion if either you or your spouse sold a principal residence during the last 2 years that qualified for this exclusion.

Remember, the “2 years” is an aggregate amount of time, i.e., 2 X 365 days, and they do not have to be consecutive days.

See your CPA to be sure these rules still apply, if there have been any changes, and any interpretations that may be of benefit to you.

Features of the new laws:

1. Ones listed above;
2. As was true under the old law, you cannot deduct a “loss” on a sale of a principal residence. With today’s real estate market, if you need to sell at a loss, check with your CPA, as you might still have some tax to pay!;
3. If you used the $125,000 exclusion in the past, you can still use the full amount of the new exclusion on the sale of your present house;
4. If you sell your home, you can move into a property you presently own, and if you make it your principal residence, and you meet all the requirements, including the 2 year waiting period, you can again use the $250-500,000 capital gains exclusion;
5. You do not have to be living in the house at the time you sell it;
6. If you sell before the 2 year period, you may get to use some of the exclusion, depending upon the reasons for your move. See your CPA;
7. If 3 single persons own a house and meet all the requirements, each can take the $250,000 exclusion;
8. Through the efforts of the Calif. Assoc. of Realtors, the State of California also agreed to the $250,000 and $500,000 capital gains exclusions;
9. And if your spouse dies, if you sell during that tax year, you can take the $500,000 exclusion. But if you wait until the following years, you are then “single” per the tax laws, so you can only get a $250,000 deduction. BUT, if you have an appraisal of the value of the home as of the date of the spouse’s death, you can probably get a “stepped up” basis and have no capital gains tax when you sell!!!

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


I don’t want to try to make you an expert on income taxes, that you should do with your accountant, but there are some terms that you need to know to understand the basics of what capital gains tax you might have to pay.

First, let’s make a distinction between “equity” and “gain.” If the value of your home is $800,000 and the loan balance is $200,000, the difference is $600,000. Is this your equity or your capital gain?
The $600,000 figure is your “equity,” and that is what we usually think of regarding our homes. However, “gain” has nothing to do with the loan balance or the equity in your home. You and I usually call “gain,” “appreciation.” Gain (capital gain) is the difference between the sales price and the basis (tax basis) of your home. “Basis” is basically the purchase price of your home.

Lets define this a little further. How do you calculate “capital gain?”

“Sales Price” is defined as the “net” sales price, i.e., the sales price less the commission and any other selling costs, or credits to the buyer.
“Basis” is defined as the purchase price of the home plus any capital improvements plus any adjacent land acquisitions less any “accumulated deferred capital gain” on the sale of previously owned homes on which you deferred paying capital gains by doing a “1034” rollover (under the old laws).

If you have owned your home for many years, you may very well have capital gains in excess of the $250,000 or $500,000 exemption, and if so, when you sell your home, you will have to pay capital gains tax on that excess. Again, before you decide to sell your home, go see your accountant and find out exactly where you will be, tax-wise, so that you will know how much money you will have left from the sales proceeds after you pay any capital gains tax.

Now as I mentioned at the end of Part 7, if you are husband and wife, and probably today, even if you are domestic partners, if you hold title correctly, and one of you have died, you may be able to avoid any capital gains tax by having an appraisal of the home at the date of death of the spouse or partner so that you can get a “stepped up” basis. What does that mean? If you had sold your home while your spouse or partner was alive, and let’s say your sales price was $1,000,000 and your basis was $200,000, your capital gain would have been $800,000 less the $500,000 exemption, or $300,000. With the appraisal at the time of death, your “basis” gets stepped up to the market value of the home at that time. If the date of death wasn’t too long ago, its probable that any appreciation since then would be less that $250,000 and you would have no capital gains tax to pay. If you did not have an appraisal at that time, it is still possible to get what I call a “back appraisal” to that time.

Remember, I am not an accountant or an attorney. I just want to make you aware of some things that you may have not heard about or your Realtor may not know all about. So do see your accountant before you decide to sell.

So the next question is “where are you going to move to?” Location, size of housing, type of housing, lots of choices, and these all need to be decided BEFORE you put your home on the market.

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


Where are you going to move to?. To me, this is probably the most important question that you MUST answer BEFORE you put your home on the market for sale. I sometimes tell Sellers: If an offer comes in on your home for full price, no contingencies, and close escrow and give occupancy in 30 days, where are you going to go?

First, let’s look at one option: are you going to stay in Ventura or move to another county in California?
What difference does this make? It can affect the amount of property taxes you pay if you buy another property. So let’s talk about Proposition 60 and 90!

Proposition 60
Would you like to move down in price and not have your property taxes go up? For example, you have lived in your present home for many years, and it would sell today for $800,000 and the property taxes are only $1,500 per year. If you were to sell it and buy a condo at $500,000, your new property taxes would be approximately $5,500 per year. You may be able to take advantage of Prop. 60, if you meet certain criteria.
1.The house you are selling and the new property you are buying HAVE to be in the SAME county.
2.You must be 55 years or older.
3.Both properties MUST be your principal residence, and you must own and occupy both.
4.The new property must be of equal or lesser value, though there is a small allowance that the new property can by higher in price if purchased within two years after the sale of the first.
5.The taxpayer has two years before the sale of the original property until two years after the sale of the original property, to purchase or build a replacement property.
6.The use of Prop 60 is optional, so to use it, you must apply for it. It will not happen automatically.

My experience says that there are a lot of “footnotes” to the above, footnotes that are not on the forms that they give you, so it is best to go to the Assessor’s Office and to the person who specializes in Prop. 60, and tell them precisely what you are going to do. Do remember that City and County employees have no liability for what they say, so be as clear as you can as to what you are going to do and the values of both homes.

Proposition 90
What if you decide to move to another county in California. Prop. 60 does not apply then, but Prop. 90 may! Prop. 60 is required in every county in California, but Prop. 90 was optional, and each county had to decide if they wanted to do it. From the Assessor’s viewpoint in another county, why would that county want to give a new senior buyer the low carry over property taxes, while the county they moved from would be able to get new, higher Prop. 13 taxes from the new buyer of the old house! The terms and requirements of Prop. 90 are basically the same as Prop. 60, so most counties decided against Prop. 90. The last I checked, only the following counties have Prop. 90: Alameda, San Mateo, Santa Clara, Los Angeles, San Diego, Orange and Ventura. Remember, you have to basically go down in price, which might be difficult if you are moving to Santa Clara county. Since these counties can revoke Prop. 90, if you are thinking of moving to one of these counties, or to any other county, I suggest you call the Assessor’s office in that county and see if they have adopted Prop. 90.

Rather than buy another type of shelter (home), you can rent a house, apartment, or condo. The advantages to this are that you have no large cash outlay (usually just a security deposit), no property taxes to pay, and maintenance is the landlord’s responsibility, not yours. The disadvantages are that you have no income tax deduction for interest or property taxes and over time, your rent will probably increase.

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top



We need to go back to the “benefits” you want, in your new housing.

1. Type of housing: single family home, condominium, mobile home, houseboat, apartment, retirement community, assisted living?
2. Location: in the city where you now live, so you can be near friends, in the same county, the same state, in Seattle, Miami or Mexico?
3. Size of house and land, number of bedrooms, bath, landscaping, etc.?
4. Amenities wanted: type of weather, near a University, Opera & Ballet available, near or on a golf course, pool?

You need to sit down and make out this list of benefits you want, and do it this afternoon! If you are husband and wife, make your lists separately and prioritize the items, then put the lists side by side and take the top items from each list and prioritize them. You might be surprised how different they might be.

This is a “tentative” list, but you need to now go and check out these items . It is an education! When you actually check them out, you may find that you don’t really want or need some of them, and you may add others. After all, it may have been 20-50 years since you purchased any new housing.

As an example, a husband and wife (Seniors) who had been looking all over the Bay Area for a year and had not found another house. They called me regarding selling their home, but I would not list it for sale until they knew where they were going. So I suggested they do their list of “benefits” as I said above, and one week later, after playing golf, on their way home, they stopped to see a “loft” and purchased it! The first house they saw could have been the right one for them, but until they made their list of benefits so they knew what they wanted, it was tough to make any decision.

Or, another way to say what Dennis said, is: “If you don’t know what you are looking for, you’ll never find it, and even if you see it, you won’t recognize it!”

My advice is to go and personally check out where you “think” you want to move to, BEFORE you even think of putting your home on the market! Some people have sold their home, moved back East for a year, then decided they really preferred Marin county, but when they came back, they found out that their old home just sold for $100,000 more, and now they can’t afford to live here anymore!

If the place you are thinking of moving to is out of the area, my advice is to go there for 2 weeks in the summer and 2 weeks in the winter, and see if the place and weather are what you are expecting, or remember.

You may want to go back to where your were born or raised, lets say North Dakota, and as a kid, you loved the snow, but would you like it as a Senior? You’d like to move to Seattle because it is green all year long, but I have lived there, and its green cause it rains a lot there, and is often overcast. Will this make you feel depressed, if you are used to lots of sun? Or Florida, where the real estate is cheap and the weather is warm, but once the temperature reaches 72 degrees, humidity sets in. So try those places you might want to live in, do it first, in fact, best to do it now while you are still in good health.

Also, if you are going to purchase a home, look at the difference in the following items, between California and the State and city where you might move to: cost of living, sales tax, income tax rate, housing costs and property taxes. Remember, if it’s not California, there will be no Prop. 13, so your property taxes will figured differently. I remember one client telling me there was a big difference between Connecticut and New York. I can’t remember which is which, but one had high sales tax and no property tax, and the other was just the opposite.

My adage: “If you can’t get more benefits in your new housing, why move????”

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


When purchasing a new home or condominium, remember, that all those disclosure forms you had to fill out when you sold, you now must receive when you purchase. If your new home is out of California, you may get less forms, though most states are now following California, but if the seller does not give you a form you had in California, and you feel it is information you want, give them the form to fill out!
These forms could include a Transfer Disclosure Statement, Residential Record Reports from the municipality, etc., but you as a buyer will still want to have Pest Control and Contractor inspections, and to pick a good and knowledgeable Realtor.

If you are buying a condominium, remember that there are many additional disclosures you should and often must receive. Fully find out what your are paying for, monthly fees and future assessments. Also, in California, you must receive their “reserve budget” that shows what items are going to be replaced in the future and they may require future additional assessments.

If you are considering a “Retirement Housing Facility,” there are 3 basic types, but over time, many of the present facilities overlap and incorporate some of each of these three types.

Active Retirement /Planned Adult Communities
This is a community where active retirees and pre-retirees live and enjoy the many facilities. These are usually large residential developments with a country-club atmosphere. The minimum age is usually 55.
Financially: you normally buy a living unit and pay a monthly fee for use and care of the common facilities.
Housing/Facilities: you buy a single family house or a condominium; extensive recreation facilities often include a golf course, tennis courts swimming pool, social and crafts rooms.

Health Care: Normally not any on the premises, but available in a nearby city.

Congregate Care/Independent Living
This type of facility offers full-service rental arrangements which take care of all your housing and food needs.
Financially: No large financial outlay is required, as it is usually a month to month rental, so normally just a security deposit is required.

Housing/Facilities: the unit you rent can vary in size from a studio to a 1 bedroom. If it is an independent living type, it will include minimal cooking facilities. You can usually leave with a 30-60day notice. Your monthly rent pays for your living unit, utilities, and may or may not include 1-3 meals per day in the dining room. Some include weekly maid service. There are usually some recreational and craft facilities, organized activities and outings, allowing for social interaction.

Health Care: usually none is included, but some have a nurse on duty or on call, and doctors are often in nearby facilities. This type of facility is for older person, but usually they must be ambulatory.

Life Care/Continuing Care Facilities
For the payment of an initial sum of money and a monthly fee, they take care of all your needs, housing, food and full medical care, for the rest of you/your spouse’s life.

Financially: There is a large entry fee, the amount depending on that facility, on the size of your unit, and on the view you get. There is a monthly fee, which will go up over time.

Housing/Facilities: you will have a nice apartment type of unit, ranging in size from a studio to 2 bedrooms. Your monthly fee includes all the items that come with congregate care, but are more inclusive and at a higher level of service and quality. Social activities are many, but recreational facilities may be limited.

Health Care: full health care with medical facilities and medical staff on the premises. Major operations are included, but may be done at a hospital.
Be sure and fully check out this type of facility to know that they are financially secure and have extensive experience in managing this type of facility. You are putting in a lot of money to them, and faith in them, and if they go bankrupt, you lose it all and are out in the street!

Some of these facilities have age limits, as well as health limits, so be sure to get all this information from them.

My advice on retirement facilities, or even on any place you are thinking of moving to, is to go to the facility and talk not just to the administrators, but talk to at least 5 people you see on the premises that live there. Tell them that you are considering moving there and ask each what they “ like” about the facility and what they “dislike” about it. This way you will get a cross section of opinions, and then you can put them together with your list of “benefits” and see how they fit. Also, this may make you change some of the “benefits’ you thought you wanted. Seeing facilities in person may change a lot of your ideas!

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top


This is the last in this series. Remember, I am not an accountant, an attorney or an estate or financial planner. This last part has to do with how you hold title to real estate, and the consequences thereof.
My purpose here is to simply make you aware of some of the options you have, so if some sound of interest, then go see the appropriate professional and see how the idea would work for you. Sure, at $300-$500 per hour, it’s expensive, but you could save $100,000 or more by getting and using the correct professional advice.
If you die without even a will, then your estate goes through probate, and your estates goes to whomever the State of California decides.

Probate is very expensive and time consuming, and in my opinion, very outdated. You pay a fee to the executor and attorney and the court, the first two fees are high and are based on the full value of the estate, not its net value. It can easily take 6 months to accomplish, as the attorney will get paid no matter how long it takes, so it is often at the bottom of his pile of cases. And there is no privacy. You can go to the court house and fully read the will of anyone going through probate!

Anyone can hold title as “tenants in common.” Ownership can be divided between the owners in even or uneven amounts. Each tenant can convey his interest, and the buyer is then a tenant in common with the other owners. If a tenant dies, his will determines to whom his interest goes and it will probably go through probate.

Another way to hold title is as “joint tenants.” Anyone can do this, and it is often used between husband and wife. Each tenant holds an equal interest in the real estate. When a tenant dies, his/her interest automatically goes to the remaining tenant(s). A “will” will have no effect on this. If one tenant conveys his/her interest, then the buyer, and all the other tenants, become “tenants in common.” This was often used as it avoided probate. Basically all that has to be done is to record a certified copy of the death certificate of the deceased. Although, technically, the property basis would only be stepped up on the decedent’s share of ownership, since California is a “community property “ state, an IRS Rev. Rule #87-98 indicates that even if the property is held as Joint Tenants, it can be community property in California and therefore get a full step up in basis. Check this with your accountant.

Another way is to hold title as “community property.” This can only be done with husband and wife, although, with the new laws, “domestic partners” may also be able to hold title this way. Probate can be avoided by an attorney filing a “community property petition. You can get a full “step up in basis.”

A relatively new method combines the values of Joint tenancy and community property. It is called “Community Property with Right of Survivorship.” This way, you avoid probate, and get a full “step up in basis.”

From my experience in real estate, it is easiest if the husband and wife held the property in a revocable living trust. If a spouse dies, a certified certificate of death is recorded, and the remaining spouse usually then becomes the “successor trustee” and can easily pass title to a buyer. Also, for most purposes, the Trust and its terms are “private.” If the husband and wife own a lot of assets, they may want to consider an “A/B” type of revocable trust, as it provides for both husband and wife to each obtain an estate tax exemption, not just the remaining spouse when that spouse dies. Again, see your estate attorney for a full explanation of this. It could save many thousands of dollars to the heirs.

Finally, don’t be in a hurry to sell. Do your homework way ahead of time so that you know where you are going to move to, and to be sure it meets 90% of your benefits desired and needed. Then put your home on the market to sell with a good Realtor, and use the Multiple Listing System, as it reaches the most buyers and will get you the best price. And, if you need some further assistance in making these decisions, see the professionals, including a Realtor who knows all of the information in these 12 articles, as they can be of the most help to you by doing “real estate counseling.”

Please remember, I am not an attorney, accountant of financial planner. The purpose of these articles are to help you in making a decision, to give you some ideas to think about, and to raise some questions that you might not have thought about. Before you act on anything in these 12 articles, I strongly advise you to see a professional first, especially an accountant &/or an attorney, to see how the ideas in these articles will affect you, in your life, and your unique personal and financial situation

By Bruce M. Wrisley, Past President of the Marin Association of REALTORS and a real estate broker in Marin County for 50 years. Back To The Top