My Lubbock TX Real Estate Blog

RISMEDIA, August 28, 2009-(MCT)-Bob Menconi enjoys his newly replaced air conditioner at his house. The A/C was replaced by a federal tax rebate. So your car isn’t a clunker? And you’re not buying a new home? But maybe your air-conditioning unit is on the fritz. Or your small business needs new equipment or office furniture. Perhaps you have always wanted solar panels. Then there is a tax break waiting for you, too.

Although there hasn’t been much hype surrounding these credits and deductions-all increased or expanded by federal stimulus bills passed this year and last year-retailers say sales of new, energy-efficient products are beating expectations in the midst of the recession.

The reason, they say, is the prices are that good.

In Davie, Fla., Menconi said he paid the same amount for a new air conditioner as he did for the one he bought about 20 years ago. The price for his new Ruud air conditioner: $6,295. But the combination of a rebate from Florida Power & Light, the manufacturer and a $1,500 credit on his taxes next year means he will pay $3,520. On top of that, he said, the first month, the family electric bill was $200 less than the previous month. The tax credit “pushed us in the direction to do it,” Menconi said. The old one “cooled the house, it was just not efficient. We wanted to catch it before it broke. At 20-plus years old, it was just waiting to bust.”

Any air conditioner that qualifies for the tax credit will also definitely qualify for the FPL rebate, said Ralph Scanga, owner of Air Conditioning Excellence in Hollywood, because the federal energy efficiency requirement is more stringent than the power company’s.

Federal stimulus laws allow homeowners to get a tax credit of 30% of the cost of energy efficient windows, doors, water heaters, air conditioners and furnaces, up to a maximum of $1,500. So if you max out the credit on your new A/C, you can’t use it for one of the other items. But if you don’t use any or all of the credit this tax year, you can buy a qualifying item and claim the credit or any remaining credit in 2010, said Amy McAnarney, an executive director at H&R Block’s Tax Institute. The items have to be installed by Dec. 31, 2010, for taxpayers to claim the credit. McAnarney also cautioned buyers not to take a company’s word that an item qualifies. She said to get a copy of the manufacturer’s statement.

Another tax credit allows homeowners to get up to 30% of the cost of solar energy systems, such as solar water heating and solar power, small wind systems and geothermal heat pumps if they are installed by Dec. 31, 2016. It’s separate from the credit for windows, doors and air conditioners, so homeowners can use both.

And there’s no cap on the amount of the credit, much to the liking of Miami Shores area homeowner Spike Marro. Marro spent about $54,000 to install solar panels and a battery back-up system for his three-bedroom home. But he got about $20,000 from a state solar energy rebate program, and will receive a further $10,200 as a credit on his taxes. That puts the final price tag for his system at around $24,000-and he will keep saving because his electricity use has shrunk to less than $100-and some months, less than $20. “In the long run it pays for itself,” he said.

But to keep customers like Marro buying, the state needs to keep the rebates coming in addition to granting the tax credit, said Paul Farren, owner of The Energy Store in Hollywood. The program had run out of money until the state padded the fund for rebates with federal stimulus dollars.

Water heaters are also a hot item because energy efficient water heaters might also qualify for more money back than just the tax credit, said John Lipka, owner of E.H. Whitson Plumbing in Hollywood. For example, he said, a natural gas tankless water heater, which can run from $1,600 to $2,000, would net a $450 rebate from gas company TECO and a 30% tax credit on the purchase price. That price is competitive with a traditional $800 tank water heater, he said.

Some of the deductions and credits might be harder to come by than others though. Miami-Dade and Broward counties have strict codes for impact resistant windows, but many energy efficient windows don’t meet that code, said Susan Roeder, corporate affairs manager of Andersen Windows. But at least one company, PGT Windows, based in Venice, has a product that meets both counties’ impact resistant standards and the federal tax credit program’s energy efficiency rules, said Jim DiPietro, administrative director of Broward County’s Board of Rules and Appeals, which oversees building code enforcement in the county. “The products do exist,” said Rusty Carroll, the county’s chief structural compliance officer. “You just have to dig a little to find them.”

Another obscure tax break: a bigger deduction for businesses that buy new equipment or furniture, IRS spokesman Mike Dobzinski said. Land, buildings and items like a new central air conditioner don’t count. Section 179 of the tax code has been around for a while, but the 2008 stimulus package doubled the amount deductible to a maximum of $250,000 and the 2009 law extended the deduction through the end of 2010. In this case, businesses could claim the entire deduction each year, he said.

Still not enough? A whole new set of government gifts will arrive late this year or early next. That’s when Florida’s version of a Department of Energy rebate program for energy efficient appliances should be approved, said Jeremy Susac, director of the Florida Energy Office.

The state is expecting at least $17.5 million in federal dollars it can issue in the form of rebates to buyers of the right kinds of dishwashers, washing machines, refrigerators, dryers, air conditioners and other items. But the Feds have to approve Florida’s list of appliances, and that might not happen until later this year.

Think carefully before you run out and buy a new fridge right away, he said. It’s unclear whether the state will be able to issue rebates for items bought before the federal government approves Florida’s plan. “We’ve asked that question,” he said. “Certainly, save the receipt.”

(c) 2009, The Miami Herald.
Distributed by McClatchy-Tribune Information Services.

Many home buyers assume that because the national housing market is struggling, the Lubbock real estate market is bad as well.  Nothing could be further from the truth!  As of this morning, there is only 1,281 single family homes on the market, which is the lowest amount of active inventory we've had in at least 4 years. 

Around 1,300 homes is a balanced market for our market.  Our overall inventory trend has continued on a downward trend the past 2 months when listing inventory is usually increasing.

While the numbers are good for our overall market, we still face a challenge, which is with appraisals.  Because of greater governmental scrutiny, appraisers are appraising to the conservative side, affecting homeowners to the tune of thousands of dollars.  We've seen homes that were involved in a competitive offer situation, where multiple buyers felt like the respective homes were top of market homes, yet when appraised, the appraiser appraised them much lower than the agreed to sales price - despite having comps to support the agreed to sales price.

If you are a home buyer in Lubbock, don't be surprised if you find yourself in a competitive situation for a good, updated, move-in ready home.  If you are a home seller in Lubbock, realistic pricing of your home is critical in order to try to pass the appraiser's scrutiny.