South Florida Real Estate and Community News

March 15, 2024

Selling in June Could Net Sellers an Average of $7,700 More $$!

Key Details:

  • New Zillow research shows selling in the first two weeks of June nets homeowners an additional 2.3% (about $7,700), compared to those selling at other times of the year, according to 2023 sales data. 
  • The best time to list a home for sale in the years leading up to the pandemic was in early May. Mortgage rates were climbing in May 2023 but pulled back a little in early June. 
  • Zillow economists expect a similar trend with rates in 2024. 

Homeowners planning to sell in early June this year may earn more from the sale compared to those selling at other times of the year. 

Zillow analysis of 2023 home sales shows a 2.3% increase in home sale prices—about $7,700 extra on the typical home—for those who sold in the first two weeks of June. 

Compare that to the years leading up to the pandemic when the best time to list was early May. Last year, mortgage rates were climbing in May, but they pulled back a little in early June, making a home purchase affordable for more buyers. 

Zillow housing economists expect this year’s home-shopping season to follow a similar pattern. And if the Federal Reserve begins rate cuts mid-year (or later), we may even see a second wave as mortgage rates continue to fall. 

Last year’s sale price premium in early June came after the first spring in over 15 years with mortgage rates above 6% on a 30-year fixed-rate loan. Those rates were rising in May before sliding from 6.79% to 6.67% in early June. 

With more buyers able to afford a home purchase, competition for available homes heated up, and sale prices increased. 



In 2022, sellers across the U.S. received the highest sale premium when they put their home on the market in late March—just before mortgage rates skyrocketed past 5% and kept climbing. 

Since then, mortgage rates have been impacting affordability and, consequently, buyer demand. 

According to Zillow research, the best time to list can vary widely from one metro to another. In 2023, the best time to list in San Francisco was in the second half of February, while, in New York, sellers saw the highest premiums in the first half of July. 

Thirty of the top 35 U.S. metros saw the highest sale prices on for-sale listings between May and early June of 2023. 

Zillow data also shows a wide range in the sale price premiums for homes listed during peak periods. During San Jose’s hottest time of the year (early June), homes sold for 5.5% more, netting sellers an additional $88,000. 

Meanwhile, during the same time period, homes in San Antonio sold for 1.9% more. 


Sale price premiums and premium windows for 35 U.S. metros:

  1. New York, NY (First half of July) Sale price premium: 2.4% ($15,500)
  2. Los Angeles, CA (First half of May) Sale price premium: 4.1% ($39,300)
  3. Chicago, IL (First half of June) Sale price premium: 2.8% ($8,800)
  4. Dallas, TX (First half of June) Sale price premium: 2.5% ($9,200)
  5. Houston, TX (Second half of April) Sale price premium: 2.0% ($6,200)
  6. Washington, DC (Second half of June) Sale price premium: 2.2% ($12,700)
  7. Philadelphia, PA (First half of July) Sale price premium: 2.4% ($8,200)
  8. Miami, FL (First half of June) Sale price premium: 2.3% ($12,900)
  9. Atlanta, GA (Second half of June) Sale price premium: 2.3% ($8,700)
  10. Boston, MA (Second half of May) Sale price premium: 3.5% ($23,600)
  11. Phoenix, AZ (First half of June) Sale price premium: 3.2% ($14,700)
  12. San Francisco, CA (Second half of February) Sale price premium: 4.2% ($50,300)
  13. Riverside, CA (First half of May) Sale price premium: 2.7% ($15,600)
  14. Detroit, MI (First half of July) Sale price premium: 3.3% ($7,900)
  15. Seattle, WA (First half of June) Sale price premium: 4.3% ($31,500)
  16. Minneapolis, MN (Second half of May) Sale price premium: 3.7% ($13,400)
  17. San Diego, CA (Second half of April) Sale price premium: 3.1% ($29,600)
  18. Tampa, FL (Second half of June) Sale price premium: 2.1% ($8,000)
  19. Denver, CO (Second half of May) Sale price premium: 2.9% ($16,900)
  20. Baltimore, MD (First half of July) Sale price premium: 2.2% ($8,200)
  21. St. Louis, MO (First half of June) Sale price premium: 2.9% ($7,000)
  22. Orlando, FL (First half of June) Sale price premium: 2.2% ($8,700)
  23. Charlotte, NC (Second half of May) Sale price premium: 3.0% ($11,000)
  24. San Antonio, TX (First half of June) Sale price premium: 1.9% ($5,400)
  25. Portland, OR (Second half of April) Sale price premium: 2.6% ($14,300)
  26. Sacramento, CA (First half of June) Sale price premium: 3.2% ($17,900)
  27. Pittsburgh, PA (Second half of June) Sale price premium: 2.3% ($4,700)
  28. Cincinnati, OH (Second half of April) Sale price premium: 2.7% ($7,500)
  29. Austin, TX (Second half of May) Sale price premium: 2.8% ($12,600)
  30. Las Vegas, NV (First half of June) Sale price premium: 3.4% ($14,600)
  31. Kansas City, MO (Second half of May) Sale price premium: 2.5% ($7,300)
  32. Columbus, OH (Second half of June) Sale price premium: 3.3% ($10,400)
  33. Indianapolis, IN (First half of July) Sale price premium: 3.0% ($8,100)
  34. Cleveland, OH (First half of July) Sale price premium: 3.4% ($7,400)
  35. San Jose, CA (First half of June) Sale price premium: 5.5% ($88,400)


Zillow’s research highlights three ways to shrink days on market and get a higher sale price for your seller clients.


Most buyers today start their home search online. One way sellers can make their home’s virtual presence stand out is by hiring an agent who uses listing tools like Listing Showcase. 

A Listing Showcase subscription allows the seller to show off their home’s best features with larger high-resolution photos, an AI-powered 3D home tour, and an interactive floor plan. 

Zillow data shows measurable advantages for Listing Showcase home listings compared to similar listings without the special listing features: 

  • 68% more page views
  • 66% more saves
  • 63% more shares
  • 15% greater likelihood of going pending in 14 days


Some features, when they’re mentioned in a listing description, get more buyer attention by signaling that the home is more desirable and up-to-date compared to similar listings. 

More buyer interest means more competition, so these homes generally sell faster and for more money. 

Mentioning a steam oven or pizza oven, for example, can help a home sell for up to 5.3% more. Mentioning a doorbell camera can help a home sell up to five days faster. 



Zillow data shows most sellers make a minimum of two improvements to their home before listing it for sale. One of the most common home improvement projects is interior painting. But some paint colors add more (buyer-perceived) value than others. 

For example, according to Zillow’s latest paint color analysis, homes with a charcoal gray kitchen can sell for roughly $2,500 more than homes with different paint colors in the kitchen. 

In a nutshell, it pays to know what buyers are looking for. And that awareness should take into account how trending home design on social media can influence buyer perception of value. 

Posted in Selling Your Home
Dec. 18, 2023

5 Important Things to Do When Preparing a Home for Sale

Preparing to sell a home can be quite a daunting task. It's not just a matter of putting up a sign, listing it and waiting for the offers to roll in. Many things need to be done to help ensure a quick and profitable sale. These tips will help you prepare your home for the market and make the sales process as smooth and stress-free as possible.

Make the Home Comfortably Livable
One of the most important things to do before putting a home on the market is to ensure it's comfortably livable. This means ensuring everything is in working order, fixing any damage or wear and tear, and keeping it clean and tidy. The potential buyer wants to be able to visualize themselves living in the home, so it's essential to keep it inviting and decluttered. If that means getting new insulation, roofing, windows or other larger tasks, make sure to get it done. Consider renting a storage unit for any unnecessary items and hiring a professional cleaning service to get your home looking spotless.

Get Good Photos for the Listing
In today's digital age, most potential homebuyers will begin their search for a new home online. This is why it's essential to have high-quality photos for your listing. Work with a professional photographer to capture your home at its best and highlight its best features. Your photos can make all the difference in attracting potential buyers and getting them to schedule a viewing of your property.

Get an Appraisal Done
Before listing your home, it's a good idea to get an appraisal done. This will give you a clear picture of what your home is worth and help you price it appropriately. An appraiser will consider factors such as location, square footage and the property's condition. Pricing your home too high or too low can turn off potential buyers, so getting this right is essential.

Make Any Upgrades to Improve Value and Curb Appeal
Upgrading your home can help increase its value and curb appeal, making it more attractive to potential buyers. Consider making minor upgrades such as adding fresh paint, updating hardware and replacing fixtures like lighting and faucets. If your budget allows, consider making larger upgrades, such as updating appliances or renovating a bathroom or kitchen. All of these updates can make a big difference in catching a buyer's eye and getting them to put in an offer.

Have a Good Source for Selling the Home
Finally, it's essential to have a good source for selling your home. This may be a real estate agent, a listing service or an online marketplace. Do your research and find a source with a good reputation and a track record of success. A good agent or service can help you navigate the selling process, offer advice and connect you with potential buyers.

Preparing a home for sale can be a lot of work, but it's essential to a successful sale. By following these five high-priority tips, you can help ensure that your home looks its best, is priced appropriately and is ready for potential buyers. Remember to make your home comfortable and inviting, get high-quality photos, consider an appraisal, make upgrades where possible and find a good source for selling your home. With a bit of effort and planning, you can sell your home and move on to your next adventure.

Posted in Selling Your Home
Dec. 7, 2023

FSBO Sellers Regret Not Having an Agent

Survey: Sellers who go-it alone are twice as likely to be unsatisfied with the experience – and more likely to say their earlier opinion, “agents are overpaid,” was wrong.

Homeowners who decline to use a real estate agent to sell their property are twice as likely to say they weren’t satisfied with the selling experience, according to a new survey from Clever Real Estate of 1,000 home sellers in 2022 and 2023. Survey respondents say they realize they likely made less money on their home sale and faced more stress by not having a professional representative.

Those who didn’t use a real estate agent said before their transaction that they think pros are overpaid for what they do and are not more knowledgeable about the home selling process than the average seller. However, when these respondents reflected on their experience after the transaction, they admitted that they made some mistakes without the help of a pro.

More than a third of non-agent sellers, such as FSBOs (for sale by owner) or those selling to an iBuyer, said the process was more difficult than they expected. What’s more, these sellers admitted:

•    Buyers distrusted them because they didn’t have an agent (43%)
•    They struggled to understand their contract (40%)
•    They made legal mistakes because they didn’t use an agent (36%)

The survey also found other consequences of going it alone as a seller:

•    Lower sales price: Homeowners who sold without a real estate agent are three times more likely to say they lost money on their home sale. The Clever Real Estate survey found that those who sold their home with an agent tended to earn $46,603 more in average profits than those who sold without an agent in 2022 and 2023. About half of unrepresented sellers say they wish they had priced their home differently, and nearly half now believe their home would have sold for more if they would have used an agent.
•    Longer selling process: Home sellers without an agent are nearly twice as likely to say they didn’t accept an offer for at least three months; 53% of sellers who used an agent say they accepted an offer within a month of listing their home. Yet many homeowners who didn’t use an agent said the primary reason for going it alone was to sell faster.
•    More stress: Half of home sellers who did not use an agent admit to crying at some point in the process, and 52% of unrepresented home sellers said they felt overwhelmed by the entire sales process. On the flip side, homeowners who hired an agent were more likely to say they felt good about their sale and expressed less stress.

Home sellers who used an agent also had some gripes about their experience, albeit much fewer. But those who were unhappy with their agent experience expressed feelings like their agent was only looking to make a sale and didn’t care about their interests, their agent “annoyed” them, or they thought the agent pressured them into decisions, the survey found.

That said, 77% of respondents who used an agent say they were satisfied, and 72% say they would use their agent again.

Even though the vast majority of home searches start online, most consumers still use real estate agents to buy or sell a home. Indeed, the National Association of Realtors®’ (NAR) 2023 Profile of Home Buyers and Sellers found that 89% of buyers and sellers in the last year used a real estate agent, up from the previous year.

Only 7% of homeowners sold as a FSBO over the last year – which matches the all-time low recorded in 2021, according to NAR data. FSBOs continue to not fare as well in the market as professionally represented homes: FSBOs sold at a median price of $310,000 in the last year, compared to $405,000 for listed homes, NAR’s data shows.

Having a Realtor help you navigate the homebuying and selling process provides peace of mind, especially in a challenging market with high prices, elevated mortgage rates and limited inventory.


Nov. 8, 2023

How Does a Mortgage Buydown Work?

Some homebuyers priced out of the market opt for a mortgage buydown, usually funded by sellers, in order to lower their monthly payments for the first few years.

RICHMOND, Va. – Mortgage rates have risen since the Federal Reserve implemented a new monetary policy in 2022, almost hitting 8%. As of Nov. 2, the average 30-year fixed mortgage rate in the U.S. is 7.76%, the highest it’s been in over 20 years.

High interest rates combined with low housing supply have been making the housing market undesirable for buyers and driving down sales activity across the nation. Many potential buyers have been overwhelmed by rising home prices and are put on the sidelines to continue renting. There is a tool called a 3-2-1 mortgage buydown that can incentivize potential homebuyers to buy a home in high interest rate markets.

How does a 3-2-1 mortgage buydown work?

When potential homebuyers are priced out of the market, they can try to get a 3-2-1 buydown mortgage. This type of mortgage reduces the loan interest for the first three years of the loan term. The initial rate will then be applied in the fourth year and continue for the life of the mortgage.

In the first year, the loan is reduced by 3%, by 2% in the second year and 1% in the third year. For example, if a homebuyer bought a home at a 7.76% mortgage rate in the first year of the loan, the rate would be 4.76% the first tear, 5.76% the second year, and 6.76% the third year.

The cost of a 3-2-1 buydown mortgage is the total amount that the buyer saves over the three-year period of lower rates.

Usually, this type of mortgage is used by sellers or home builders to help ease the costs for buyers. Sometimes, a company would cover the buydown cost when relocating an employee to a new city to help with expenses. Buydown mortgages are only used for primary and secondary homes, not investment properties. The lender must still qualify the homebuyer at full interest rate before implementing this tool.

Buydowns increase when interest rates go up

Towards the second half of 2022, the share of temporary mortgage buydowns surged when rates increased to over 6%. Temporary buydowns were controlled among a few non-bank lenders in the last year. Between June 2022 and 2023, just 12 lenders managed 80% of all temporary buydowns in the nation, according to Freddie Mac.

In recent months, temporary buydowns have been trending down compared to last year. This data can be used to analyze the willingness homebuyers have to take high interest rates.

3-2-1 mortgage buydowns have become more common for financing newly built homes because home builders usually work together with mortgage companies to negotiate the price and rates. Potential homebuyers who want to use this financial option must understand that in the fourth year, the mortgage will go up to its original rate and evaluate their finances before closing to make sure they can afford it when the time comes.

Posted in Buying a Home
Oct. 10, 2023

Key Skills Your Listing Agent Should Have

Selling your house is a big decision. And that can make it feel both exciting and a little bit nerve-wracking. But the key to a successful sale is finding the perfect listing agent to work with you throughout the process. A listing agent, also known as a seller’s agent, helps market and sell your house while advocating for you every step of the way.

But, how do you know you’ve found the perfect match in an agent? Here are three key skills you’ll want your listing agent to have.

They Price Your House Based on the Latest Data

While it may be tempting to pick the agent who suggests the highest asking price for your house, that strategy may cost you. It’s easy to get caught up in the excitement when you see a bigger number, but overpricing your house can have consequences. It could mean it’ll sit on the market longer because the higher price is actually deterring buyers.

Instead, you want to pick an agent who’s going to have an open conversation about how they think you should price your house and why. A great agent will base their pricing strategy on solid data. They won’t throw out a number just to win your listing. Instead, they’ll show you the facts, explain their pricing strategy, and make sure you’re on the same page. As NerdWallet explains:

“An agent who recommends the highest price isn’t always the best choice. Choose an agent who backs up the recommendation with market knowledge.”

They’re a Great Negotiator

The home-selling process can be emotional, especially if you’ve been in your house for a long time. You’re connected to it and have a lot of memories there. This can make the negotiation process harder. That’s where a trusted professional comes in.

A skilled listing agent will be calm under pressure and will be your point-person in all of those conversations. Their experience in handling the back-and-forth gives you with the peace of mind that you’ve got someone on your side who’s got your best interests in mind throughout this journey.

They’re a Skilled Problem Solver

At the heart of it all, a listing agent’s main priority is to get your house sold. A great agent never loses sight of that goal and will help you prioritize your needs above all else. If they identify any necessary steps you need to take, they’ll be open with you about it. Their commitment to your success means they’ll work with you to address any potential roadblocks and find creative solutions to anything that pops up along the way.

BankRate explains it like this:

“Just as important as the knowledge and experience agents bring is their ability to guide you smoothly through the process. Above all, go with an agent you trust and will feel comfortable with. . .”

Bottom Line

Whether you're a first-time seller or you’ve been through selling a house before, a great listing agent is the key to success. Connect with a real estate professional so you have a skilled local expert by your side to guide you through every step of the process.

Posted in Selling Your Home
Oct. 2, 2023

Buyers’ Tactics in the Face of High Mortgage Rates

Mortgage rates have risen to their highest levels in more than 20 years, making it harder to afford a home. And yet, out of necessity or desire, hundreds of thousands of people buy homes every month.

With the 30-year fixed rate topping 7%, NerdWallet asked real estate agents and mortgage loan officers for advice on how homebuyers can stretch their homebuying dollars in this time of high interest rates. Here are nine tactics that they suggested.

1. Ask the seller to reduce the mortgage rate

Temporary mortgage rate buydowns have become commonplace since rates surged in early 2022. With a temporary rate buydown, the seller pays a portion of the buyer’s interest payments upfront. This reduces the house payments for the first one, two or three years of ownership.

“This is a common strategy for new-home builders, but it can also be used in the purchase of resale homes,” said John Bianchi, executive vice president for loanDepot. (All sources in this story commented via email.) “Negotiating a temporary buydown with the seller can help soften the blow of high interest rates, reducing your monthly payment for one to three years.”

In one typical setup, the seller’s payment effectively cuts the buyer’s interest rate by 2 percentage points in the first year, and by 1 percentage point in the second year. After that, the buyer pays the full interest rate. This is known as a 2-1 buydown.

Another option is to reduce the mortgage rate permanently, using discount points. One discount point equals 1% of the loan amount; each point typically reduces the interest rate by around 0.25 percentage point.

“Homebuyers have an opportunity to get a seller to pay for these methods to lower their interest rate,” said Chuck Vander Stelt, a real estate agent in Valparaiso, Indiana. “Some homebuyers should seriously consider offering a more generous price to the seller in exchange for a large closing cost concession and then use those funds to buy down the interest rate as much as possible.”

2. Use part of your down payment to pay down debt

When you apply for a mortgage, the lender considers your total debt payments for the house, car, student loans and credit cards. Sometimes it makes sense to divert some of your intended down payment money to cut the higher-rate debt first, said David Kuiper, vice president and senior mortgage banker for Dart Bank in western Michigan.

“While the mortgage payment will be slightly higher, the total debt/payments is lower, making the proposed purchase more affordable,” Kuiper said.

3. Use homebuyer assistance programs

State and local governments sponsor an abundance of programs to make homes affordable for homebuyers, especially first-timers. Some programs offer down payment assistance and help with closing costs. Others offer favorable interest rates or tax credits.

Details differ from state to state. Some programs are targeted to certain counties, cities or neighborhoods. Others are intended for specific groups of people, such as teachers, first responders or renters who live in public housing. Some programs have income limits.

4. Ask the seller to finance the purchase

You can give the seller an IOU for part of the home’s value and make monthly payments directly to the seller at an interest rate that’s lower than you could get from a bank. This arrangement is called “seller financing” and has its roots in the early 1980s, when mortgage rates zoomed as high as 18%.

You might wonder why a seller would agree to such a deal.

“They will often do this in order to get the price they want,” said Janie Coffey, who leads the Coffey Team with eXp Realty in St. Augustine, Florida. The seller gets full price while you get a break on the interest rate.

Seller financing usually has an end date: Within three, five or 10 years, the buyer must get a mortgage from a lender to pay off the amount owed to the seller. Coffey explained that the type of seller open to this arrangement often has paid off the mortgage “and is OK to wait for their big payoff.”

Seller financing is complex. Use an experienced real estate attorney to draw up the contract.

5. Don’t wait for a rate you like better

“If the right house comes along and the payment is affordable (even if you don’t like the interest rate), you should buy the house,” Kuiper said.

You often hear that you should buy now and refinance someday, after interest rates fall. That’s not Kuiper’s point. His point was this: If mortgage rates fall, more buyers will rush into the market. They’ll make competitive offers and drive home prices higher, “essentially wiping out any advantage of the lower interest rate.”

6. Don’t get distracted by things you don’t need

Some sellers want flexibility about the closing date, would prefer the buyer to make repairs, and are scared of accepting an offer from a buyer who ends up failing to qualify for the mortgage.

Vander Stelt advises staying focused on price with these hassle-avoidant sellers, while being flexible on the rest of the offer on the house. “Do this by offering the best terms you can, including buying the home as-is, a closing date and possession that works best for the seller, and illustrating how strong of a candidate you are to get your mortgage approved,” he said.

You can demonstrate that you’re a strong mortgage candidate by showing a preapproval letter and by sharing financial information, such as account balances that prove you have the cash for the down payment.

7. Buy a house that needs work

Buying a fixer-upper is an old-fashioned, time-tested way to save money.

“If you can be patient, it’s worth buying a home that needs work and slowly fixing it up over time or taking a renovation loan to acquire the home and do the work upfront,” said Brian Koss, regional sales director for Movement Mortgage, in Danvers, Massachusetts.

8. Build a house or buy a brand-new one

“Building a new home can provide more certainty around how long you will have to wait to move in, it can provide more cost certainty, and it can save you money in the short and long term by avoiding costly remodels, appliance repairs and unexpected repairs of older parts of the home,” said Jeffrey Ruben, president of WSFS Mortgage in the Greater Philadelphia area.

Buying a new home in a development has some of the same advantages. And today’s buyers have good reason to shop for new construction because there’s a shortage of existing homes for resale.

9. Rent out part of the house

Coffey suggested using an old strategy with a trendy name – house hacking – “buying a property like a duplex, where you live in one unit and rent out the other,” she said.

If you buy a duplex, triplex or quadplex, and you live in one unit, you can include the expected rental income for the others when qualifying for a loan. In some cases, you can qualify for a mortgage using expected rental income from an accessory dwelling unit, such as a basement apartment or a tiny house in the backyard.

If you buy a home today, you’re stuck with high mortgage rates for the time being. But by employing some creativity, you might find a way to afford homeownership.

Sept. 25, 2023

What Happens if the Government Shuts Down?

The federal government has experienced 14 shutdowns since 1980. If Congress fails to pass a full-year spending bill or a stopgap “continuing resolution” (CR) to keep the government open, there could be another shutdown on Oct. 1. But what does this mean, and how does it impact everyday Americans and the economy?

What is a government shutdown?

A shutdown occurs when there is neither a full-year spending bill nor a CR in effect for a department or agency whose budget has an expiration date. For many parts of government, that expiration date occurs at least once per year at the end of the fiscal year, which runs from Oct. 1 to Sept. 30. If a deal is not in place by Oct. 1, some federal agencies and programs will lack approved annual funding from Congress, requiring agencies to stop all programs or activities that are not critical to national security or the protection of lives or property.

The alternative to full-year spending, a CR, keeps programs and activities funded for a specific period of time as determined by Congress – usually weeks or months at specific funding levels, often the same as the prior fiscal year.

How might a 2023 shutdown differ from previous shutdowns?

A 2023 shutdown might look more like the 2013 shutdown than the 2018-2019 shutdown, both in scale, timing, and impact.

Although the 2018-2019 episode was the longest in history (34 days), it was only a partial shutdown. Some agencies and departments had received full-year funding from Congress by the time the shutdown began on Dec. 22, including the Departments of Agriculture, Commerce, and Homeland Security, while other agencies and departments did not have full-year funding and, as a result, had to stop some activities and programs. The 2018-2019 shutdown also took place in December and January after the expiration of a CR, rather than at the start of the fiscal year.

The 2013 shutdown affected all departments and agencies funded by annual appropriations, since Congress had passed no full-year spending bills before funding was set to expire. The shutdown started on Oct. 1, the first day of fiscal year 2014. The effects of a 2023 shutdown would also be similar to the 2013 shutdown, at least in the early weeks.

A shutdown on Oct. 1, 2023, could also affect a number of programs whose multi-year authorization to spend taxpayer dollars expires, including support for farmers and nutrition aid under the farm bill, air traffic control efforts at the Federal Aviation Administration (FAA), and the ability to purchase flood insurance through the National Flood Insurance Program. These expirations are a separate matter than a government shutdown, but all face an October 1 deadline.

What happens during a shutdown, what shuts down, and what stays open?

A government funding gap requires departments or agencies affected by the gap to take several steps to “shut down.” Several funding gaps in the 1970s did not lead to a shutdown of programs and activities, in part because guidance at the time did not require agencies to stop activities. But any gap lasting longer than a day or two since 1980 has led to a shutdown.

When there is a shutdown, a department, agency, or program must:

  • Stop all projects and activities, usually within three to four hours
  • Furlough employees whose work activities have not been exempted from the shutdown
  • Halt pay for all government employees and contractors, whether they are working (exempted) or not
  • Sign no further contracts for goods and services

Not all parts of the federal government are affected by a shutdown. Major programs and benefits like Social Security and Medicare are generally unaffected because Congress has approved these programs to spend without an expiration date what is known as “mandatory spending.” Mandatory spending makes up $7 of every $10 spent by the federal government.

The other $3 in $10 is generally approved on a year-to-year basis by Congress, referred to as “discretionary spending,” and consists of 12 appropriations (i.e., spending) bills covering different departments and programs of the government. For example, one bill funds the Department of Defense, while another funds the Departments of Labor, Health and Human Services, and Education.

Discretionary spending includes funding for:

  • The nation’s military, including salaries and benefits
  • Public health programs, including disease detection and prevention
  • Some veterans benefits
  • Farm loans through the Department of Agriculture
  • Transportation funding to build and repair roads, highways, and bridges, as well as maintain air traffic control at the nation’s airports
  • Income support programs designed to help those most in need, including low-income women and children

Many of these important programs and services are at risk of being interrupted during a government shutdown, though activities that protect human lives or property such as military operations at the Department of Defense can continue.

When Congress has passed some but not all of the 12 regular appropriations bills, there can be a partial shutdown that affects only the departments and programs without either a full-year spending bill or a CR. For example, during the 2018-2019 shutdown, activities at the Departments of Defense, Labor, Health and Human Services, Education, Energy, and Veterans Affairs plus the legislative branch were not affected by the shutdown since lawmakers had already passed full-year spending bills for those parts of government.

Who decides what government functions stay open and what functions shut down?

Article I, Section 9, Clause 7 of the Constitution states, “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.” This means federal departments and programs cannot spend money unless Congress passes a law providing them with the funds to do so.

A 19th century law, the Antideficiency Act, also prevents federal agencies from spending taxpayer dollars in the absence of specific authority from Congress. The law was originally created in response to departments spending beyond their budgets and then returning to Congress to make up the difference. Subsequent 1980 and 1995 guidance from Justice Department officials has affirmed that the Antideficiency Act requires a shutdown of unfunded programs and activities.

The Office of Management and Budget (OMB) issues instructions and guidance to departments and agencies that may be affected by a government shutdown. OMB also requires them to develop and update contingency plans they can execute in the event of a shutdown that list the estimated time “to complete shutdown activities,” along with estimates of the number of employees expected to be exempt from a furlough (and required to continue working without pay).

These plans must be updated by agencies every few years, and the list of activities that stay open and shut down differ from agency to agency. This means that no two shutdowns are the same, and the negative impact on government operations and the economy will vary from shutdown to shutdown.

A 2023 shutdown would likely be broad in nature, since Congress has not enacted any full-year spending bills into law.

Who is affected by a shutdown?

Everyday Americans are affected when they cannot access services that are shut down. This includes veterans benefit programs. Had the 2013 shutdown lasted just one more week, 5.1 million veterans would not have received compensation checks they earned. Other essential services, such as air travel managed by the FAA and airport security managed by the Transportation Security Administration, may continue to operate but at lower levels of services, since only some employees are exempt from furlough and required to continue working.

Government employees are affected when they are either furloughed without pay, or forced to work without pay because they are exempt from furlough, until the shutdown is over. Over two million people work for the federal government. Missed paychecks can put financial stress on their households and have a ripple effect that hurts local economies across the U.S.

Small businesses can be hurt by a shutdown in at least two ways. First, the federal government spends tens of billions of dollars on contracts with small businesses for a wide variety of goods and services (nearly $163 billion, or 27% of all contract dollars, in FY2022), and these contracts can be halted during a shutdown. Second, a shutdown can halt operations at the federal Small Business Administration (SBA), which provides billions of dollars of direct and guaranteed lending and other support to small businesses across the country.

What is the economic impact of a shutdown?

Government shutdowns hurt the U.S. economy. The Congressional Budget Office (CBO) estimates that the 2018-2019 shutdown, lasting 34 days, resulted in $3 billion in permanent lost economic growth. About 300,000 federal employees were furloughed during that shutdown, and hundreds of thousands more had to work without pay until the shutdown ended in January. The 800,000 total employees at agencies affected by the 2018-2019 shutdown made up around 40% of all government workers. (In 2018, Congress passed funding for other agencies.) The effects would have been more severe had some departments and agencies covering five of the 12 regular spending bills Congress must pass on an annual basis not already been funded with full-year appropriations.

Previous shutdowns resulted in even more employees being furloughed: 850,000 during the 2013 shutdown, and 800,000 in the early parts of the 1995-1996 shutdown. Though the government has never had a months-long shutdown, such a disruption could result in billions of dollars of lost economic activity. Even a weeks-long shutdown can have permanent negative economic effects north of $1 billion.

A lengthy shutdown in 2023 could also delay the release of economic data from the Bureau of Labor Statistics and the Bureau of Economic Analysis, such as unemployment figures and gross domestic product (GDP) estimates, at a precarious time for the U.S. economy. Fiscal policymakers in Congress and monetary policymakers at the Federal Reserve rely on this data to make evidence-based and data-driven decisions, while investors rely on the data to make smart investments. Significant delays in releasing this data could make it more difficult for policymakers and investors to steer the U.S. economy through a time of high inflation and uncertainty.

How much a shutdown hurts the U.S. economy depends on a number of factors, including how long the shutdown lasts and what parts of government the shutdown affects. Generally speaking, longer and broader shutdowns inflict more economic damage.

When was the last government shutdown?

The last government shutdown was from December 2018 through January 2019, and was also the longest government shutdown in history, lasting 34 days.

Overall, there have been 14 shutdowns since 1980. A majority –11 of 14 – were relatively short, lasting less than a week. The other three were longer than two weeks.

Is a shutdown different than reaching the debt limit?

Yes. The causes of a government shutdown and a breach of the debt limit are different, and so are their potential effects on the U.S. government and the U.S. economy. While a government shutdown is when some departments and agencies of government no longer have an approved budget from Congress, the debt limit instead restricts the total amount of money that the federal government can legally borrow. When the debt limit is reached, the Treasury Department can no longer borrow money to cover government operations.

As opposed to a government shutdown, which generally only affects programs and departments with an annual budget (i.e., discretionary spending), failure to address the debt limit in a timely manner could affect all types of government spending (i.e., discretionary and mandatory), including programs like Social Security, Medicare, and Medicaid.

History shows that government shutdowns are damaging but not catastrophic, with relatively predictable outcomes. In contrast, defaulting on obligations as a result of the debt limit would be unprecedented, with consequences that are likely far more disruptive, damaging, and severe. Even a short-term default could lead to higher borrowing costs, increased unemployment, stock market losses, and GDP contraction.

The government is not at risk of reaching its debt limit on Oct. 1, 2023. The Fiscal Responsibility Act, which became law earlier this summer, suspended the debt limit through Jan. 1, 2025.

How can policymakers prevent government shutdowns?

The best way out of a government shutdown is for Congress to reach an agreement on full-year spending or, failing that, a stopgap CR. A CR in 2023 could buy lawmakers time to reach a bipartisan agreement on full-year spending before the end of the calendar year.

In the long run, Congress needs to reform the budget process so that lawmakers more regularly pass spending bills on time. Over the past 40 years, Congress passed all 12 annual spending bills before the Oct. 1 deadline just four times. In most years, lawmakers have needed multiple CRs to keep the government open and buy more time to pass a full-year spending bill a total of 200 CRs over the past 47 years, an average of more than four per year. Clearly the current process is not working, which is why BPC is working with lawmakers and experts in both parties to build a budget process that is more efficient, timely, and effective.

Sept. 12, 2023

Real Estate Pros’ Staging Checklist for Sellers

Many home sellers want to move fast, but they’ll likely need to do some prep work to get their property show-ready. But sprucing up a property needs to be strategic to maximize results. That’s where a real estate professional and home stager can come in to help. is external), a home improvement resource, recently compiled a list of the home staging projects that real estate professionals most commonly recommend to their sellers, as well as the cost for each project. The site culled information from the National Association of REALTORS®’ 2023 Profile of Home Staging. View the breakdown of the top projects below.

Infographic from fixr about the cost and impact of home staging projects

Below, find a list of overall projects often recommended, along with the pricing for each.

A chart comparing the cost and percentage recommended by experts for various home staging projects


Posted in Selling Your Home
Aug. 29, 2023

What is FIRPTA and How Do I Avoid It?

Florida real estate agents for foreign sellers need to understand the Foreign Investment in Real Property Act (FIRPTA).

When the Foreign Investment in Real Property Tax Act (FIRPTA) took effect in 1984, it exposed foreign sellers to capital gains tax on appreciated real property. Today, in states like Florida, FIRPTA transactions are common.

But what exactly is it, and what does it mean for you?

The Basics

Passed in 1980, FIRPTA imposes income tax on foreign persons in the disposition appreciated real property located in the United States. Such transactions include a sale or exchange, liquidation, redemption, gift, transfer, etc.

When dealing with a property transaction involving a foreign national, FIRPTA is the first thing real estate professionals and investors need to consider.

Who is subject to FIRPTA?

Non-U.S. taxpayers who sell their U.S. real estate holdings are subject to FIRPTA withholding. This includes nonresident alien individuals, foreign corporations, partnerships, trusts and estates. Expatriates are also subject to FIRPTA if the sale of their property occurs post-expatriation. There are also special rules for domestic LLCs with foreign owners.

When it comes to FIRPTA, every seller is considered foreign unless they can prove otherwise. That’s why it’s a common and prudent practice for real estate sale agreements to include an affidavit under penalty of perjury stating that the seller is not a non-resident alien for purposes of U.S. income taxation.

Although not subject to FIRPTA, buyers and closing agents are responsible for withholding it and may be held liable for it by the IRS. It is imperative that FIRPTA is addressed before the deal is closed in order to avoid any potential issues.

Navigating FIRPTA Withholding

If a property sale is identified as involving a foreign national or entity, there are several considerations to make in regards to FIRPTA withholding. Current guidelines establish different withholding rates depending on the sales price and the use of the property by the buyer:

  • If the amount realized is less than $300,000, FIRPTA may not be applicable if certain conditions (described in the next section) are met.
  • If the amount realized is $300,000 to $1 million, FIRPTA is withheld at a rate of 10% of the amount realized.
  • If the amount realized is more than $1 million, FIRPTA is withheld at a rate of 15% of the amount realized.

The realized amount includes cash, fair market value of non-cash consideration (such as another property) and debt released during the transaction. FIRPTA withholding must be set aside and submitted to the U.S. Treasury Department within 20 days of the closing.

FIRPTA withholding is reported on IRS Form 8288 (U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests). The seller should also receive form 8288-A.

How to Avoid FIRPTA

If the seller is a U.S. person, there is no need to be concerned with FIRPTA as it only applies to foreigners. However, some green card holders may be considered foreign by the IRS. Additionally, some foreigners may have valid Social Security numbers.

There is also no FIRPTA withholding required if the amount realized on the sale is less than $300,000 and the property will be used mostly as a home by the buyer. To meet this exception, the buyer must certify that they intend to use the property as their residence for more than 50% of the days the property is used by any person during the first 24 months after the sale.

The only other way to avoid FIRPTA is via a withholding certificate. If FIRPTA withholding exceeds the maximum tax liability realized on the sale of the real property, sellers can appeal to the IRS for a lower withholding amount. For example, if the sale of the property results in a loss to the non-resident individual, FIRPTA can be avoided all together.

The application for withholding certificate is complex and usually done using IRS Form 8288-B (Application for Withholding Certificate for Dispositions by Foreign Persons of U.S. Real Property Interests).

Several attachments and certifications need to be included with the form 8288-B, and the certificate has to be filed before or on the date of the closing, so it’s imperative to start preparing the required information way ahead of the planned date to close the deal. The IRS has 120 days to authorize a lower withholding. FIRPTA withholding should be held in escrow while awaiting the IRS decision.

Stay Cognizant of FIRPTA

Any real estate transaction involving a foreign national needs to trigger FIRPTA considerations. Real estate agents operating in markets with heavy foreign investment should be well-schooled in the process of recognizing FIRPTA triggers and authorizing contracts on behalf of both buyers and sellers.

For more information, it’s best to work with a skilled international tax professional who understands the nuances of FIRPTA.

Posted in Selling Your Home
Aug. 16, 2023

Study Shows On-MLS Sales Fetch $50k Premium

It’s a tale as old as time. The FSBO who plans to forgo the traditional real estate process until a few weeks (or months) of watching neighbors sell and field lowball offers brings them back to the agent—and to the MLS.

While real estate professionals will argue all day for the benefit of using an MLS to sellers, what does the data actually say? Do sellers really benefit financially from using the traditional real estate process, even after accounting for commission paid?

According to a new survey conducted jointly by Drexel University and Bright MLS, the answer is, they do—often by a lot. Comparing over three years of on-MLS and off-MLS sales, researchers found that on-MLS properties brought in an average of 15.25% more—and that premium could be increasing.

“When you look at the home prices that a seller got when they listed their home on the MLS…we found that the price premium of on-MLS sales was actually higher during the pandemic and in 2022 than it was before,” says Dr. Lisa Sturtevant, Bright MLS chief economist, who co-authored the study. “(And) we’ll probably see a bit of an increase in 2023.”

In dollars, that premium translated to just over $53,000 for 2022 in Bright’s footprint, and over $63,000 in Q1 2023 (though Sturtevant characterized the Q1 data as “preliminary”).

Comparing homes with similar characteristics and locations that sold on or off the MLS, and also differentiating for regions within Bright’s six-state footprint, the study found these premiums persisted across geography as well as time.

A previous iteration of the study conducted last year mostly utilized pandemic-era transactions, and left unanswered questions about how both a unique housing market and other societal disruptions might have affected MLS use. With another year of data, Sturtevant says she is getting more clarity.

“This year we were able to then add even more transactions and actually even get a better perspective of what happened during the pandemic,” she says. “What we didn’t know is, did the benefit to sellers of listing on the MLSs stay the same over the pandemic when we were in such an unusual housing market? A little bit surprising to me—the share of homes that were sold on the MLS actually increased during the pandemic.”

Who is off the grid

Besides looking at premiums, the survey also found what other research has largely corroborated over the last few years: that people are still relying on the MLS to list their homes. The share of homes sold on MLS in Bright’s footprint rose from 84% in 2019 to just under 90% at the beginning of this year.

During the hot seller’s market of 2020-21, the narrative in mainstream media was that many people were quickly making deals to sell homes off-MLS—either through pocket listings or “office exclusives,” or as traditional FSBOs. That doesn’t appear to have been the case, at least in Bright’s region.

“People were hearing about how crazy the housing market was,” Sturtevant explains. “They wanted to get the best price for their house, but maybe they didn’t want to interact with a whole lot of buyers. It was a global pandemic, right? Maybe you didn’t want to be responsible for showing your house or finding people to come look at your house.”

Another assumption that grew with and has continued after the pandemic is that most off-MLS sales involve high-end or exclusive properties as pocket listings, marketed secretly in affluent circles. 

Sturtevant says the survey would indicate that isn’t the case, with so-called “office exclusives” making up a “relatively small share” of overall listings. In fact, it appears that many off-MLS sales are a very different transaction—distressed properties going to nonprofits or investors. Baltimore, Maryland, had the highest share of off-MLS sales across the survey period, and Sturtevant says that is where this redevelopment was happening.

Most of the rest of off-MLS transactions were FSBOs who likely had “a variety of reasons” for forgoing the use of an agent, Sturtevant says. The type of home didn’t seem to make a huge difference either, with a variety of price points, sizes and characteristics going off-MLS.

But the on-MLS premiums also persisted across all these variations, the survey found—including between rural, suburban and urban areas—meaning that regardless of the specific kind of house the seller is trying to move, MLS transactions are getting a higher price.

“The theory is, if you list a home on the MLS, it gets more eyeballs. You get better offers because you have more people that look at your properties. And we found that that was indeed the case,” Sturtevant says.

Going forward, she adds that it is likely the ratio of on- and off-MLS transactions will level out, with larger trends driving what consumers need—and want—on both sides of a housing transaction.

“Over the last few years, there’s just been so much growing interest among consumers to have as much information as possible,” says Sturtevant. “They don’t want to be in a market where they feel like some listings are being held away, and they’re not able to see them.”

Access the full study here.