Wednesday, April 30, 2014

Midland, Michigan Receives Honors as a Great Place to Live

Summary: Midland, Michigan is a great place to live. Studies conducted by Forbes Magazine, CNN Money and SafeWise are helping to solidify that reputation.

The city has been named the fourth best city in Michigan to raise a family; one of the top eight cities in America with a thriving middle class; and has twice been named one of the 100 best communities for America’s young people. The Movoto Real Estate Blog even named Midland the number one city in Michigan.

Real Estate expert Shelley Park Cluff, Broker and owner of Park Place Homes explains, “The Midland area continues to receive these honors because of its outstanding educational opportunities, cultural and art programs, affordable living, and diverse recreational possibilities. All of these things come together to create a great place to raise a family.”
Forbes Magazine agrees. Their recent study concludes that Midland’s low crime rates, high median household income and high school graduation rate ranks Midland as the fourth best small city to raise a family.

A CNN Money study also names Midland County, Michigan, and Midland specifically, as one of eight areas in America where the middle class thrive. Midland’s 6.6% unemployment rate, median household income of $50,861 and good quality of life contribute to the city’s high ranking. They also name Midland’s robust fire, police and road services as contributing factors.

“The Midland real estate market is a testament to these statistics,” said Cluff. “Of the homes sold in Midland this year, the average price has been roughly $140,000, which makes our area very affordable and attractive for middle class families.”

 Safety statistics are also important to Midland’s reputation as a desirable place to live.  A recent SafeWise report names the locale as one of the 50 safest cities in Michigan based on FBI reports of both violent and property crimes.
“When choosing a place to live and raise a family, safety is of primary importance,” adds Cluff. “Studies like this increase everyone’s confidence that they have chosen to live in a safe community.  Also, as a real estate broker and long-time resident, I can confidently speak of Midland’s safety.”

Cluff says another reason Midland ends up on these best lists is Midland’s wide variety of year-round activities. The city offers arts and cultural experiences which rival those found in larger cities.  Unique shops and restaurant venues grace the downtown district. Sports opportunities are endless and even include ice skating on the hottest of summer days. Midland’s Chippewa Nature Center is one of the largest non-profit nature centers in the country with peaceful nature trails, bird watching opportunities and more. The city is also peppered with neighborhood parks boasting playgrounds, a place for dogs to run, fishing and even canoeing. The list of available activities is extensive and diverse. Visit the City of Midland website to learn more.  

For more detailed information about the Midland real estate market, home values, and homes for sale in the Midland area, contact Shelley Park Cluff at 989-698-1100, or visit her website:

About Park Place Homes

Shelley Park Cluff launched Park Place Homes with the goal of creating unique, custom real estate experiences for her clients. She has firm roots in Midland with knowledge and expertise to share about the local real estate market and community. Whether buying or selling a home, she’ll work tirelessly to create the experience you deserve.    

Contact Information

Shelley Park Cluff

(989) 698-1100

Tuesday, April 29, 2014

The Question Every Cash Buyer Should Answer

Warning Cash.pngPaying cash for a home seems like a huge advantage to qualifying for a mortgage and an appraisal.  However, for the fortunate few who don’t need a mortgage, there is a question they should answer before they make that decision: Do you think at any point in the future, you might put a mortgage on this property?

It’s important because paying cash for a home could affect the ability to deduct the interest if the homeowner should place a mortgage on the home at a later date.

Most homeowner’s know they can deduct the interest on up to $1,000,000 of acquisition debt on their principal residence but they may not understand the limitations of such debt.

Acquisition debt is the amount used to buy, build or improve a person’s principal residence.  The amount is not static but changes over time.  An amortized loan reduces the principal owed with each payment made and the acquisition debt is reduced accordingly.  If a person stays in a home long enough to retire the loan, the acquisition debt is reduced to zero.

Our current federal law allows a homeowner to deduct the interest on the acquisition debt plus the interest on up to an additional $100,000 home equity debt.  If a person pays cash for a home, the acquisition debt would be zero and the only interest deduction allowed would be for home equity debt.

If you answered yes or even maybe to the question, before you pay cash to buy your home, you should discuss your situation with your tax advisor.

Monday, April 28, 2014

Waterfront Living Can Be a Dream, With Preparation and Knowledge

Waterfront living!  A dream for many homeowners.  However, as demonstrated by recent flooding in the Midland and Sanford areas, waterfront living does come with potential challenges and risks.  One of those risks is the potential for property or home flooding.  “Homeowners should be aware of the possibility that even if their home is not in sight of the river or lake, the elevation it sits at could lend itself to being in a flood zone,” said Shelley Park Cluff, owner and Broker of Park Place Homes Real Estate in Midland. 

A home that is listed in the 100 year flood plain (or less), is required by mortgage lenders to carry flood insurance.  In the past, this was based on the value of the home and would approximately double the annual cost of home owner’s insurance. 

In order to protect new homeowners, this year President Obama signed into law the Flood Insurance Relief Law, which repealed the Federal Emergency Management Agency’s (FEMA) authority to dramatically increase rates when a property is sold, a proposition made by FEMA in 2013 in order to recoup rising expenses.  The new legislation caps the increase at 18% annually on new homes, and 25% annually on older homes.  “Even with the potential of 18% - 25% annual increases upon home sale, this is still a savings as compared to what FEMA had proposed,” said Park.

In order to assess flood insurance potential, the website has a quick and easy tool to search properties and assess your risk.  “This is helpful if you are shopping for a new home and need to estimate annual insurance expenses,” said Park. “No one wants to be surprised by learning about expensive flood insurance requirements after their purchase offer has been accepted.”

Another valuable tool is GIS mapping, which shows where the flood maps are in the city of Midland, and some local townships.  On the map, users can follow the flood zones to see how close they come to their current or prospective homes. 

“Also check out where your home stands with a LOMA letter, formally known as a Letter of Map Amendment,” said Park.  “If your property is listed in the flood plain, but the structure is not, it is possible to hire a site engineer to conduct an elevation survey to exempt your home from requiring flood insurance.  This cost is approximately $600-$800, but worth the savings.”

An elevation survey can also potentially reduce required flood insurance premiums.  “Essentially, every inch matters,” said Park.  “A difference of just a few inches can mean the difference of hundreds of dollars a year in your flood insurance premium.”  It is worth making sure the data supplied by FEMA, which is estimated, is proper so you are not over charged.

If your property or home was recently flooded, visit the Midland County Department of Health website at for instructions regarding treatment of wells, septics and homes. For more information about flood insurance assessments on your current or prospective home, contact Shelley Park Cluff at 989-698-1100 or

Thursday, April 24, 2014

Tis the Season for Orange Barrels

It's spring in Michigan and that means the reappearance of everyone's favorite street decor: the orange barrel.

Midland is a beautiful place to live; and we figure we can handle a bit of road construction if it means keeping the city in good shape. Plus, well maintained roads mean potential buyers are less likely to get lost in a pothole while driving by your house for sale.
You can always find up to date information regarding current construction projects at the City of Midland's website, but we've included the list of 2014 projects for you, below.  Happy Spring, and happy travels!

Tuesday, April 22, 2014

A Lower Payment is Your Choice

Mortgage acquired 250.png94% of purchasers last year opted for a fixed-rate mortgage at some of the lowest rates in home buying history.  Yet, some of them will pay more in interest than necessary based on the time they’ll own the home.

If a person only plans to be in the home a few years, the adjustable-rate can offer significant savings.

Not only is the interest rate on the adjustable-rate lower than the fixed in the initial period, amortization on a lower interest rate amortizes faster than a higher interest rate.

In the example shown below, a $200,000 mortgage for 30 years is compared using a 4.25% fixed-rate to a 3.25% 5/1 FHA adjustable rate.  The first five years of the ARM generates a $113.47 a month savings which accumulates to $6,808.20.  In addition, due to faster amortization on lower interest rate loans, the unpaid balance at the end of five years will be $3,001 lower on the ARM for a total savings of $9,801.

Assuming the adjustable-rate mortgage was to escalate the maximum allowed at each period, the breakeven would occur in 8 years and 6 months. If a person were to sell the home prior to this point, the ARM would provide a lower cost of housing for the homeowner.

For some people, the uncertainty of how the interest rate may change is not acceptable.  On the other hand, for the risk tolerant individual who may be more confident in financial matters or who may know when they’ll be moving next, the ARM can be a smart choice.

To make projections using your individual numbers, see the Adjustable Rate Comparison.

InTouch ARM.png

Friday, April 18, 2014

The Home of Tomorrow

The Michigan Association of REALTORS® recently published an article in "Michigan REALTOR®" explaining four rising trends believed to be shaping the home of tomorrow. Author Deirdre Sullivan of wrote, "the home of tomorrow isn't about Jetson-esque wonders and smartphone apps. It's about home value, the environment, and our lifestyles".
Active Greywater Toilet: Caroma

Here's a breakdown of the trends Sullivan noted and how you may see them take shape:

1) Extreme Energy Efficiency
    What to look for:
      -Smarter use of water in the loo through waterless toilets, which are a step further than their low-flow brothers, and grey water systems which reuse household water.
      -Garages wired for electric vehicles. This trend is already taking up permanent residency in Palo Alto, California where building code now requires new homes to be wired for electric car chargers.

2) The Rise of Super Storms
    What to look for:
      -Generators capable of running the whole house. A home generator can not only keep your household functioning for days during a storm, but approximately 52% of the cost of a generator can also be recouped.

3) The Locally Grown Movement
    What to look for:
      -Indoor gardens are likely the next step in the push for healthier food and responsible purchasing. These handy little green spaces combat rising food prices (attributed to transportation costs) and can actually improve air quality within the home and offer a boost to a gloomy disposition.

4) Sophisticated Appliances and Fixtures
    What to look for:
      -"Multi-purpose uber appliances", says Sullivan. Just as the smartphone has eliminated the need for an alarm clock or CD player, General Electric predicts that by 2025 our sinks will also act as dishwashers, our washing machines will also fold our clothes, and kitchen faucets will dispense water, ice, miscellaneous beverages and even vitamins.

So far we haven't seen many of these trends take shape in the Midland real estate market, but you can bet we'll be the first to tell you when they do! In the mean time, if you're looking for your home of tomorrow give us a call or browse our website for more info on the homes available today!

Tuesday, April 15, 2014

An Exchange Means More to Reinvest

Section 1031 exchange for rental and investment real estate is a tool that allows investors to move the gain from one property to another without immediate income tax consequences. 
An instant benefit is to postpone the tax due which gives the investor a larger amount of proceeds to invest.  In the example shown, the investor has 21% more proceeds to invest and grow over time than if he had paid the taxes due instead of exchanging.
A legitimate long-term goal might be to make qualified exchanges from one property to another until the investor dies.  The heirs would then receive a stepped-up basis on the property based on the market value at the time of the decedent’s death and possibly avoiding taxes altogether.
There are specific requirements to be met in order for the exchange to qualify. For more information on exchanges, see IRS publication 544.  In addition to enlisting the services of a real estate professional familiar with investment property, seek the help of Qualified Intermediary to facilitate the intricacies of the exchange.  Your real estate agent can help you locate one.
Exchange example.png

Thursday, April 10, 2014

7 Rules for a Livable Layout

Whether you're staging to sell, moving into a new home, or looking for a fresh makeover for your existing place, carefully planning where you'll put your furniture is worth the time and effort.  How you arrange your furniture dictates how you use a room.

Of course, we're often restricted by the size and shape of the furniture we own and the rooms need to fill.  Given what you have to work with, HGTV has laid out seven simple rules for arranging furniture that will help you maximize the livability and visual impact of your rooms. Click the link below to browse through their slideshow and pick up a few tricks to try in your home!

Design by Jennifer Jones; Photo from

Tuesday, April 8, 2014

Is the Window Closing?

iStock_000011016597Small 250.jpgWith interest rates lower than they’ve been in over 40 years, it may be difficult to think of a “window of opportunity” closing.  However, it isn’t difficult to understand that it may very probably cost more to live in a home in the near future due to rising interest rates and prices.

Zillow recently reported results from a nationwide study that home values are expected to appreciate by 4.5% through the end of the year.  Coupled with Freddie Mac’s projection that rates are going up, the cost of housing for buyers by the end of the year will be higher than it is now.

While uncertainty of the future can stagnate some people, the fear of loss can be much more devastating when a person realizes that the amount they pay to live and enjoy a home could have been considerably lower had they acted when prices and mortgage rates were lower.

The following example considers a $250,000 purchase today with a FHA mortgage compared to what it might be at the end of the year with a higher price and interest rate as discussed earlier.  The net effect is that it will cost $191.87 more each month to live in the very same home based on the cost of waiting to buy.

To see what the cost might be for your price range, use this Cost of Waiting to Buy spreadsheet.

cost of waiting.png

Thursday, April 3, 2014

Spotlight Listing: 3310 Lakeside

Before you know it, we'll be enjoying another beautiful Michigan summer. Take a look at 3310 Lakeside, listed for $349,900, and the lake house you've been dreaming of could be yours before season hits! This beautiful, traditional 2-story home offers 3470 square feet of living space and 85 feet of main Sanford Lake frontage. The expansive view up and down the lake, a sandy bottom perfect for wading out to swim, and a dock and steel sea wall make for the ideal waterfront retreat.

Inside the home, you can appreciate the professional updates (completed in 2000) that have been made which have expanded the view of the lake and opened up the home.  Whether your more interested in continuous daytime light or a beautiful sunrise view, the two story foyer and numerous lake-side windows will certainly meet your needs.

And what good is a gorgeous house on the lake without an equally beautiful kitchen in which to make your favorite summertime meals? This kitchen is open to the living room and dining room- assuring that the cook will never be lonely- and has windows facing the deck and water. Modern kitchen appliances, granite counter tops, and hardwood floors finish the space in style.

Upstairs, each of the spacious bedrooms have waterfront views.  The master suite has a generous walk in closet and a large private bath complete with heated ceramic floors and private deck. Additional living space is offered on the second story as well as in the walk-out lower level.

When you add features like 2 fireplace, vaulted ceilings, space for a home-office, custom bookcases, attached 2.5 car garage, and a security system it is clear that 3310 Lakeside is the lake house you've been dreaming of. Park Place Homes' REALTOR® Carol Park would love to take you on a private showing. You can reach her by email,, or by phone, 989-698-1100.

Tuesday, April 1, 2014

Looking for the Largest Deduction

Standard Itemized.pngIRS allows taxpayers the option to take the standard deduction or the itemized deduction.  The astute taxpayer will compare to see which one will result in the greatest deduction and the election can be made each year.
The 2013 standard deduction for a married couple filing jointly is $12,200 and $6,100 for a single taxpayer.  It doesn’t require any proof of actual expense and has no requirement for home ownership.
Items that can be included on Schedule A for itemized deductions include:
  • Certain taxes paid for state and local income tax, general sales tax, real estate property taxes, personal property taxes or other taxes paid
  • Qualified home mortgage interest, investment interest or possibly, mortgage insurance premiums
  • Charitable contributions
  • Casualty or theft losses
  • Medical and dental expenses that exceed 7.5% of adjusted gross income if born before 1/2/49 or 10% if born after 1/2/49
  • Job expenses and other miscellaneous deductions that exceed 2% of adjusted gross income
A non-homeowner taxpayer who has been taking the standard deduction needs to consider that it isn’t just the ability to deduct the mortgage interest and property taxes.
While the standard deduction might be the obvious choice for a non-homeowner, the combination of the mortgage interest and the property taxes plus other allowable deductions not recognized previously such as charitable contributions, now makes taking the itemized deductions significantly more advantageous.