Individuals, estates, or trusts are subject to withholding if either federal form 1099-S must be filed with the IRS reporting the sale OR if sale proceeds are disbursed to a seller with an out-of-state address. Corporate transfers will be subject to the withholding if there is no permanent place of business for the entity in Colorado, and that is confirmed if they are a Colorado domestic corporation; they are qualified by law to transact business in Colorado; or if they maintain a permanent office in the state.

Withholdings are made by the title company or closing agent. Attorneys, banks, savings & loans, corporations, partnerships, or other entities providing closing and settlement services also shall withhold the tax if applicable to the transaction. The amount withheld shall be the lesser of 2% of the sales price OR the net proceeds that would otherwise be disbursed to the seller upon closing.

You may be exempt to withholding if any of the following apply:

1. Sales price is $100,000.00 or less.
2. Transferor (seller) has a Colorado address upon closing and for 1099S purposes.
3. Transferee is a bank or corporate beneficiary under a mortgage/deed of trust, and the property is acquired through foreclosure or by Deed-in-Lieuof foreclosure.
4. Transferor is a Colorado corporation or is currently registered with the Secretary of State to transact business in Colorado.
5. Transferee is a partnership as defined by the IRS, and required to file an annual federal return.
6. The title company, closing agent or other settlement service provider, in good faith, relies upon a written affirmation executed by the transferor (seller), certifying under penalty of perjury they are exempt from withholding if one of the following apply:
   1. Colorado residency;
   2. Permanent place of business in Colorado for the corporation;
   3. The real property being conveyed is their principal residence; or
   4. The transferor will not owe Colorado income tax estimated to be due from inclusion of the actual gain recognized on the sale in gross income of the transferor.

Normally, Colorado tax will be due on any transaction where gain will be recognized for federal income tax purposes. Gain is typically recognized any time the sales price of the property exceeds the total of the taxpayer’s adjusted basis in the property plus expenses incurred in the sale.

The closing agent will have a Form DR 1083 completed with closing. This form must be submitted to the Colorado Department of Revenue if tax is withheld OR if Colorado tax would have been withheld except for the signing of a written affirmation as noted above. When taxes are withheld, the funds must be submitted along with Form DR 1083 and Form DR 1079 to the Department of Revenue within 30 days of the closing date. The transferor will also receive a copy of these forms to submit with their Colorado tax return.

The information provided here is deemed reliable and based upon C.R.S. 39-22-604.5. This does not constitute legal, financial or other professional guidance for consumers regarding tax implications. Sellers are advised by Guardian Title to seek legal and/or financial advice on their transaction.

Rates have stayed near the bottom for this long partly because of the Fed’s economic stimulus, including its decision to continue to reinvest in mortgage-backed securities.

Rates have stayed near the bottom for this long partly because of the Fed’s economic stimulus, including its decision to continue to reinvest in mortgage-backed securities.

“There are still a lot of people out of work and a lot of foreclosures,” he says. “The government wants to keep the cost of money down. If rates were to go up, it would hurt the recovery.”

Also helping mortgage rates is the gloomy outlook for the debt crisis in Europe.After eurozone leaders signed off on a second bailout package for Greece, investors seemed to have gained some confidence in the region. But recently, investors have received clear signs Europe’s debt woes are far from over.

Uncertainty in the political and economic arena in Europe has renewed the fear among investors. While that’s not good news for the U.S. economy, it helps mortgage rates.

Simply put, homes in the region didn’t appreciate in value over the last decade as much as in the coastal regions, Arizona or Nevada.  What didn’t go up much before the bubble burst in 2008 didn’t go down much once it did.

Homes certainly lost value, but owners don’t have to regain as much ground to attain their earlier equity.

“We didn’t experience the bubble that California, Florida, Arizona and Nevada did,” said Thomas Thibodeau, a residential real estate expert at the University of Colorado’s Leeds School of Business. “Prices in Denvercame down about 14 percent, peak to trough, and it now looks like the decline has come to an end.”

In 2008, Thibodeau co-authored a study examining 84U.S. metro areas for signs of a speculative housing bubble. Twenty-five cities showed housing prices 30 percent over the expected increase, the study concluded.  But with the exception of Las Vegas, all were within 75 miles of the Pacific or Atlantic coast.

“Extreme speculative activity, so prominently publicized, was extraordinarily localized,” the study concluded.

The 2012 story of residential real estate in the so-called Intermountain West can be told in a tale of three cities —Salt Lake City, Albuquerque and Denver— where its population is most concentrated.

Denver Almost Tops

The closely watched Case-Shiller index for January showed theDenver market in positive territory for the first time in 18 months.

The slight 0.2-percent, year-over-year increase was the third-best showing among the 20 cities tracked in the barometer.

Other than Denver, only Detroit and Phoenix showed price increases, at 1.7 percent and 1.3 percent, respectively.

Chris Mygatt, president of Coldwell Banker Colorado, says an improving housing market is reverberating throughout Denver’s economy. “I think it’s an important tell-tale sign, one of many pointing to a continued recovery and stability in the Denver housing market.”

Mygatt adds, “I’m being told that there is an increase in furniture sales and landscaping. It really is across the board. Although our strength is modest compared to recoveries of the past, I really do think there is a fundamental shift in consumer confidence and the local economy.”

Another positive sign is the number of unsold resale homes. They plunged 42 percent in February from a year ago. 

There were only 10,086 unsold single-family homes and townhomes/condominiums on the market in February, about 60 percent less than the year-ago period, and the least for that month since 2000.

“The inventory is a somewhat challenging situation,” he says. “It’s a good-bad situation, depending on whether you are a buyer or a seller.”.

“For the first time in five years I’m getting multiple offers on homes”. “So I’m putting escalation clauses into offers again. We tell the seller we’ll pay them $10,000 over whatever other offer they get.”

The biggest problem Denver brokers are having is finding properties for buyers, “Relocation clients, people moving here fromNashville or Southern Californiafor jobs, are blown away by the market here. They say they like a house, we go back and it’s already under contract.”

“Prices aren’t up much yet, but I think they’re headed that way”.   I’m seeing more consumer confidence, people feeling better about their jobs and the economy. In Colorado, we feel as if we are finally moving forward, that the worst is behind us.”

The Fed has helped to keep mortgage rates artificially low through its continuous purchase of government and mortgage bonds, which is a policy known as quantitative easing.

Many investors hoped the Fed would add another round of stimulus, but most Fed members lean away from that idea and seem ready to let the U.S. economy stand on its own. At least, that is the message investors got Tuesday, after the minutes from the last Federal Open Committee Meeting were released. “The U.S. government can’t buy its own debt forever,” says Brett Sinnott of CMG Mortgage in San Ramon, Calif.

 What does that mean for borrowers? It means rates won’t stay low forever. Rates started to climb as soon as the FOMC minutes came out Tuesday afternoon, but they adjusted down a little after Spain’s troubled bond market made the headlines Wednesday morning.

The consensus in the mortgage industry is that rates will climb from their lows by the end of the year.

RATEFORECAST
April 6th, 2012

 Will rates rise or remain relatively unchanged this week?
Industry experts and analysts provide their insights.
·       14% of respondents expect rates to fall in the coming weeks  
·       72% predict a further increase in mortgage rates while the remaining  
·       14% forecast that mortgage rates will remain more or less unchanged

While the real estate market still has its challenges, things are very different today than they were in 2009, 2010 and even early last year. Buyers are generally more optimistic about the future, ready to purchase, much better qualified for a loan and, in many cases, are paying big down payments or even all cash for their next home.

Indeed, the scales of supply and demand are once again moving back in the direction of home sellers after being out of balance for several years. While countless buyers are out there pounding the pavement for a home, the problem now is that there just aren’t enough sellers to meet the demand in many communities.

As the economy continues to improve and with a shortage of attractive properties in good neighborhoods, buyers are once again paying good prices for properties rather than simply looking for distressed homes at bargain basement prices. And in some cases, properties are even getting multiple offers, driving up the sale price above the asking price.

So if you’ve been thinking about selling your home, now may be an ideal time to do so while buyers are eager, interest rates are still low and there isn’t as much competition from other sellers as there usually is this time of year. Here are several suggestions on how to get started and the best way to get top dollar for your home in today’s market.

• Pick the best agent for the job. Selling a home is never easy, but in today’s complex real estate market it’s particularly challenging. So it’s more important than ever to find an experienced professional Realtor to help you get the job done. This is no time for amateurs. Start by interviewing several agents to see who has a proven track record of successfully marketing properties in your area. Ask them about their marketing plan, including print media, social media and online marketing via major real estate websites. Find out how well networked they and their brokerage are to other agents with potential buyers. Do they have offices beyond your city limits and even outside the state? Today’s buyers are just as likely to be relocating from across the country as they are from across town.
• Go online and be visual. Remember the days of sticking a sign in the front lawn and taking out an ad in the local paper? Those days are long gone. Nearly 90 percent of buyers start their search for a home online, according to the National Association of Realtors. So you must be there in a big way to compete for the attention of buyers. Work with your agent to put up lots of high-resolution photos and as much information as possible. Make sure to show photos of all the major areas of your home and yard to give buyers as much of a sense of being there as possible. If not, buyers may wonder what you’re hiding. And strongly consider using video and virtual tours. Such marketing tools are no longer just for luxury homes.
• Price your home competitively for today’s market. Just because a house comparable to yours sold for a certain price before the recession doesn’t mean you will be able to get the same price today. A lot has changed since then. And while prices are firming up, it’s still important to realize the new realities of today’s market. Talk with your Realtor to determine the appropriate, competitive listing price for your home based on current market conditions. You may even choose to have an appraisal done in advance of setting the price. Remember that in this market, homes that are priced aggressively attract the most buyers and – in some cases – multiple offers that push your final sale price even higher.
• De-clutter and de-personalize. De-personalizing and de-cluttering a home before putting it on the market can help make it easier for buyers to imagine themselves living there – a crucial step in the selling process. Take down family portraits, personal collections and knickknacks. Homebuyers are looking for a home they can picture their family living in, not yours. Removing these items will also eliminate clutter and ensure that people are looking at the house itself, not at the photos from your last family vacation.
• Update, freshen up. Keeping in mind that some buyers take move-in condition to be important, put your home in its best light. Possibilities include replacing outdated kitchen and bathroom fixtures, applying a fresh coat of paint and/or refinishing the kitchen cabinets. Replace worn carpet or fix broken tiles. Many cosmetic touches are surprisingly affordable but may yield much higher sale prices. The less work buyers have to do when they move in, the faster they may be willing to make an offer.
• Conduct a full home inspection. If a professional home inspector determines that there are negative issues with the home, consider repairing the problems before buyers show up at your door. Potential buyers will cast an extremely critical eye over your home if it needs too many repairs – especially if they are trying to decide between your home and another one without problems. Be sure to have the home inspection report available for prospective buyers along with an itemizing all of the repairs that have been made and the associated cost for each to demonstrate the investment you’ve made in your home.
• Make your home and yard picture perfect. As the old saying goes, you only get one chance to make a good first impression. When a buyer sees your house for the first time, a positive impression can make or break the sale. You can maximize curb appeal by trimming trees, planting flowers and even rolling out a new lawn if needed. A fresh exterior coat of paint might also prove valuable. And consider having a professional “stage” your home to make it even more attractive for buyers by rearranging what you have and/or bringing in other furnishings and accessories.
• Be patient and flexible. You’ve done all the right things to put your home in the best position to sell. But there will undoubtedly be bumps along the way. A buyer may have difficultly securing financing. The appraisal may come in lower than expected. The escrow period could drag on longer than you thought before the deal closes. It’s not unusual to have occasional issues pop up. After all, buying a home is the single biggest financial transaction most of us will ever make in our lives. Through it all, remember that your Realtor is there by your side. He or she will be there with you every step along the way, managing the tough issues so you don’t have to and helping you achieve all of your home selling goals in today’s market.

A total of 41 homes sold for more than $1 million last month, exactly the same number as December and one more than January 2011. There were five multi-million-dollar sales in January, down from six a year ago and nine in December.

Meanwhile, the median sale price for a luxury home dipped to $1.25 million last month, down 2.4 percent from a year ago and 7.4 percent from December. The median price is the midpoint in which half of the homes sold for more and half for less.

The figures were derived from Multiple Listing Service data of all homes sold for more than $1 million last month in the Denver Metro Area.

“The luxury market in the Denver metro area continued to be fairly strong in January,” said Chris Mygatt, president of Coldwell Banker Residential Brokerage in Colorado. “Once again, the challenge we’re facing in this market is a steady decline in inventory. We need more homes on the market to meet buyer demand.”

Some key findings from this month’s Coldwell Banker Residential Brokerage luxury report: The most expensive sale in the Denver Metro Area last month was a four-bedroom, eight-bath 4,537-square-foot home in Denver that sold for $2,562,500; Denver boasted the most million-dollar sales with 12, followed by Boulder with eight and Cherry Hills Village with five; Homes sold in average of 190 days, down from 207 days the previous month and 144 days a year ago; Sellers on average received 91.6 percent of their asking price, up from 90.5 percent a year ago but down from 92.3 percent the previous month.

The Denver Metro Area Luxury Home Report is produced by Coldwell Banker Residential Brokerage, a specialist in high-end real estate sales. Through its internationally renowned Coldwell Banker Previews® program, the company is recognized around the world for its expertise in the luxury housing market.

Mortgage rates came off historic lows this week, but remained appetizingly low as sales of previously owned homes picked up steam last month.

Fear not if you don’t feel ready to refinance or buy, or if you don’t qualify. Mortgage rates likely won’t move too much over the next year, says Paul Edelstein, director of financial economics at IHS Global Insight.

“Housing is really the laggard in the economic recovery,” he says, “so the (Federal Reserve) will continue to prop up the mortgage market to induce people to buy houses.”

The central bank’s policymaking committee promised last month to maintain its benchmark interest rate near zero until late 2014, making borrowing cheap for consumers (and for businesses). The Fed also continues to buy longer-term Treasuries and mortgage-backed securities to help keep a lid on mortgage rates.

Ancillary factors such as Europe’s ongoing debt saga may flick rates up or down several basis points as investors hedge risk by buying safer investments such as Treasuries. (The 30-year mortgage rate often tracks the yield on the 10-year Treasury bond.)

But the situation overseas would need to unravel for mortgage rates to dive further, Zandi says. The more likely scenario is slow growth in the economy and a crawl upward in rates.

“They will drift higher. They will be a little higher a year from now and definitely much higher two years from now,” he says.