Bright Water in Snellville, House Hacking, 121 Exemption - could this be a key to wealth building?
-This is a transcript from Go Gaddis Radio to listen to the episode click here-> https://on.soundcloud.com/8CkF1
Welcome back to the fourth and final segment of Go Gaddis Real Estate Radio on this Vine Saturday morning. You're listening to AM nine 20, the Answer. I'm Cleve Gaddis, the host of this show, and I'm joined in the studio live and in person in Technic color by Tammy Slay. Hello, Cleve for those who listen to the show regularly.
You know, Tammy Slay is my girlfriend. She is from Dallas, Texas, specifically North Dallas, Frisco north of Plano, and she is also a real estate broker. One owns a great little teen that's an independent indie hip brokerage. Mm-hmm. Called Hip Realty Group. You got anybody who is looking to move to Dallas, anywhere in Dallas really?
Uh, just go to hip realty group.com, is that correct? Yes. Go to hip realty group.com. You got it Realty group com. You're very welcome. In fact, if I come across somebody who wants to move to Dallas, I'm gonna send you the referral myself. And if anybody in Dallas needs to move to Atlanta, absolutely. How about you send them my way?
I would absolutely do that. I love it in this segment of the show. In our neighborhood spotlight, we're featuring Brightwater in Snellville and we're gonna discuss something called House hacking. Yeah, never heard of it before. And could the 1 21 tax exemption be a key to wealth building? I say the answer is yes.
If you want to connect with us, it's easy. Go to go gaddis radio.com. G O G A D D I S radio. Dot com. You can ask questions, you can make comments. You can subscribe to our podcast. You can do the whole kitten caboodle. Each week we pick one specific Metro Atlanta neighborhood to call out critical changes.
To help you understand as a homeowner in the neighborhood, are you at an advantage or are you at a disadvantage? This week we are featuring. Brightwater, which is in Snellville. If you are on I 85 going north, you exit on Pleasant Hill. You turn right on Pleasant Hill, you turn right onto Ronald Reagan Parkway.
You exit onto Web Gen House Road and go left. The subdivision is on the left. It is um, basically to the west of 1 24 into the north of Ronald Reagan Parkway. And let's get into some details about this neighborhood for the last few years. Now, Tammy, this neighborhood is 362 homes, plus or minus. In 2020, there were 19 homes sold outta 362 houses.
How many. Homes, would you expect to sell in a year? Any idea? Let me ask the question again. Okay. I asked that question right in the middle of you coughing. I asked that question right in the middle of you coughing. Poor girl. Poor girl. Okay, I shut her microphone off as you cough. It's a real problem when you start to cough.
Yes, when you're live and on the radio. So I said there's 362 homes in the neighborhood. How many do you think should sell in an average year if there's 362 homes? And by the way, if you need me to do some 7% math, I'm having you do it for, have to say 7%. Yeah, so, so 21, 23, 24, something like that. There were 19 homes sold in 2020.
The average sales price was $476,000. Those ranged from a low four 17 to a high of 529,000. The sales price to list price ratio was 97.63%, which means home sellers had to discount their property about two and a half percent in 2021. Prices accelerated almost $120,000 and 35 homes sold in that current year.
That's a big market for that year. That's over 10%. Uh, average sales price, 593,000 ranged from a below 4 45 to a high of seven 30. Homes sold for 0.1% more than their list price. So sellers got a little bit more money than they were asking. Now let's move forward to 2022. Only 19 homes sold same as in 2021.
The average sales price jumped another a $75,000 to 665,000. They ranged from below 5 78. To a high of eight 10. There are currently two homes listed in the neighborhood. The average list price is 682,450. Makes sense. Those list prices are all, should be in today's market, just a little higher than the sales over the last year, which means there's a 1.2 months worth of supply, which means you no new inventory comes on the market.
And Tammy, I know I'm speaking to the choir here because you already know this, but if no inventory comes on the market, It'll take 1.2 months to sell the two homes in the neighborhood. Again, 362 homes in the neighborhood, plus or minus. Those homes in 2012 were worth on average, $300,000. Today there were 6 65, which means homeowner equity in that one neighborhood, those 362 plus or minus people have increased their equity in their homes, 132 million.
Wow. Every time I mention those numbers, you get, you have a biggest smile on your face. I just, I, I mean, to me it's like what's the, the security and the stability of knowing that over a 10 year span. I mean, look at the, I mean, what is that? 200%? Uh, let's see here. No, from 300 to 6 65 is 112, 115, 120%. It's double.
It's amazing, isn't it? It is. I just can't think of the, the greatest sense of security in knowing that if I buy a home today, 10 years, what would I be looking at? Yeah. And we did an, uh, an analysis on the last segment. Yes. And it was like, if it appreciates 3% a year over 30 years, it goes from 300,000 to 7 28 or something like that.
It's just, the numbers are truly amazing. Again, 1.2 months worth of supply. So it's still a seller's market in the neighborhood. Let's jump back into the, Other topics. If you are the type of parent that doesn't wanna monkey you around with your kid's education or the school's effect on home values, Tammy, what should they do?
Uh, they should go to School Chimp. They should get a school School chimp Report. Report. And how do they, where, what website do they go to to get it? Do you remember? school.com. Well, you could do that. It's eat might be Go ga. Might be easier to go to. Go gaddis radio.com. Click on the School Chimp link, just answer a few short questions.
You'll be in and out, on and off of site in 30 seconds or less. And you can either compare one high school to the average of all high schools, or you can compare one high school to another metro Atlanta High School. You have kids, you've raised four kids. Mm-hmm. Yep. They've all been through the public school system.
Yes. Uh, with the goods and the bads. And I don't care how good the school system is, there's always goods and bads in the school system. And you saw one of our school champ reports probably for the first time, maybe a year and a half ago. What did you think when you first saw one and. If you were to give advice to a listener on whether or not they need a school chip report, what would that advice be?
Well, I mean, the simple advice would be to get one, um, because as a homeowner or a home buyer, and I've been both, yep. Knowing where my home and the schools that my home is zoned for, stack up against other properties, arms me with valuable information to make a wise decision. Yeah, absolutely. And. My guess is that your kids' education was important to you.
Yes. And you would have sacrificed area and budget and other things to get them in good school districts. I'm not saying everybody needs to have their kids in a good school district, but those who are interested in having their kids get a good quality education, it might be something you have to focus on just a little bit.
Yeah. I mean, even as a home investor, you know that, that you might not be moving into that home for your own kids, but you want to know as an investor, Whether I'm a landlord investor, or I'm a flip investor. Yep. It's important to know that because it can affect the value Absolutely. Of the property over time.
Absolutely. If you're not finding what you want, as you look for houses in metro Atlanta, we've got some advice for you. Just switch over and start searching on Sure. mls.com. S U R E M ls.com. Tammy, I have never, ever, ever, ever, ever in my life, Heard the term house hacking. I've heard biohacking for my body.
I've heard lock hacking or lock picking, but I've never heard house hacking. We've only got about two and a half minutes left in the segment, but I'd love to talk quickly about that and then jump into the 1 21 exemption. Yeah. And how maybe that can help people get rich. So I'll sum up house hacking for you real quick.
House hacking is when someone buys a home where they live in that home, that's their primary residence. Yep. And then they use that home space. To rent out rooms, uh, maybe bedrooms mm-hmm. Most likely. Yep. Um, to other individuals. And the rent of those renters actually pays the mortgage of the person who owns the home.
So that person who owns the home is living somewhere rent free and they're. Tenants in the property are covering the mortgage. So it's house hacking. That's amazing. And so I think in me, most metro Atlantic counties, you can have up to four unrelated parties living in a home and consider, and that still be considered a family, if you will.
And so you could have maybe three rumors. Don't quote me in. If you're in a certain area and you know your zoning rules are different, certainly go by those. But it'd be the same as buying a quadroplex. Yes. And living in one and renting out the other three or a duplex and. So if you're listening and you have any interest in something like that, I'd love to explore it with you and it's easy.
Go Call 7 7 0 4 9 7 0 0 0 0. We also wanted to talk about the wealth building benefit of the 1 21 Exemption. 1 21 comes from Section 1 21 of the Internal Revenue Code that says, That an individual is exempt from paying capital gains on up to 250,000 capital gains taxes on up to 250,000 in gains and a married couple is exempt to up to $500,000.
So got about a minute and 40 seconds left in the segment. Give us a little update on how that works. Okay, so this is also another rising trend, um, that's very, um, interesting to follow among. Homeowner, but also investors. And so it's when a home owner mm-hmm. A buyer buys a home. Their primary residence.
Yep. It's their homestead. They live in it. They gotta live it. Right. They gotta live in there. You have to live in there at least two years. At least two years. Okay. They buy it at a discount price. There was likely a lot of things wrong with the house. Yeah. They move into it. Yep. They update it over those two years.
Okay. And then they are eligible Yes. For taking that. Free tax advantage, um, from, you know, those capital gains Yep. Exemption. Yep. But they use the proceeds of that to buy other investment properties, rental properties, or to buy another home. Wow. That they then move into, Fix up and then sell for, um, an increase in value.
So they buy it for 300,000? Yeah. They spend 50 to fix it up. Mm-hmm. When they sell it, it's now worth five 50 or 600. Yeah. So they might have $200,000 in capital gains. Yes. That they get tax free. Tax free. Because as a couple they can have up to 500,000. The married couple Yes. Is a single filer. Yeah. But a 250,000, so now you've got this 200,000 in cash, you take.
70 of it, and you go by your new single family home that you're gonna live in, and then you take the remainder of the money and you buy one or two rental properties. Yes, it could be that the 1 21 Capital gains exemption could be the key to wealth building. Now, you'd have to be willing to move every two years, but for some people that might be their retirement plan.
Yeah. We appreciate you listening to another week's edition of Go Gaddis Real Estate Radio. We'll be back next Saturday. At 9:00 AM we look forward to talking to you then Atlanta. Have a great week. Good. Goodbye.
Be the first to comment on this post!
Post a Comment