Quick and easy summary of the tax bill for residential homeowners

How the tax cut plan could affect residential homeowners (summarized)

By Ruth Ann Berklich

I read over the 30 page document that the NAR sent to Realtors, and here is what I took from it for residential home owners in regards to their property ownership.

(The following are National Association of Realtors Quotes)

Real Estate growth and capital gains

  • “projecting slower growth in home prices of 1-3% in 2018 as low inventories continue”
  • “the current-law maximum rates on net capital gains (generally, 15% maximum rate but 20% for those in the highest tax bracket; 25% rate on “recapture” of depreciation from real property)”


  • The bill “reduces the limit on deductible mortgage debt to $750,000 for new loans taken out after 12/14/17. Current loans of up to $1 million are grandfathered and are not subject to the new $750,000 cap. Neither limit is indexed for inflation.”
  • “Homeowners may refinance mortgage debts existing on 12/14/17 up to $1 million and still deduct the interest, so long as the new loan does not exceed the amount of the mortgage being refinanced”
  • “bill repeals the deduction for interest paid on home equity debt through 12/31/25. Interest is still deductible on home equity loans (or second mortgages) if the proceeds are used to substantially improve the residence.”

Moving expenses

  • “bill repeals moving expense deduction and exclusion, except for members of the Armed Forces”


To read the full article, go to



Ruth Ann Berklich is a Realtor for Real Estate One, Rochester MI (248) 652-6500, ruthann@realestateone.com


Where to buy a home in Rochester/Hills/Oakland Township for your lifestyle


Rochester Hills and Rochester are very popular for home buyers.  Not only have the cities won awards for lifestyle living and schools, but they really do have a lot to offer.

If you are someone who would like to live in the downtown Rochester area, you will search for homes in 48307 and need to know that area is so popular, you may be paying $150-$250 per square foot to live there. Older homes as well as new builds can be found as the town is very slowly revitalizing. You can walk to the many restaurants, bars and retail shopping in a 5-20 minute walk for most of these homes.

The Paint Creek biking/walking trail passes through town across Rochester Rd/Main St. under the bridge just south of Romeo, north of University/Walton roads. You can find all types and sizes of homes along this trail.

Homes around The Village of Rochester Hills outdoor mall (Walton/Adams roads) and Oakland University generally run $250k – $450k depending on which sub you visit. There are also condominiums within 2 miles of the mall.  The Village boasts upscale restaurants and retail with plenty of activities throughout the year.

Since the recovery, builders have been offering new homes all over the Rochester Hills/Oakland Township area ranging from $350k – $3M.  Moceri, Bloomingdale, Pulte and Lombardo are some of the builders who are investing here.

If you would like to live near the large strip mall at the M-59 Expressway and Rochester Road, you will find a huge assortment of home prices as well as condos and apartments.  There are car dealerships, restaurants, the courthouse, medical offices and grocery stores all within one square mile.

There are several communities with play parks, swimming pools, and tennis courts, so ask a Rochester Realtor for a list of active home sales. These range from $325k-$550k and usually have several homes on the market during the spring and summer. Be prepared to pay higher association fees to fund these amenities.

There are many golf communities in the Rochester area where you will find apartments, condos or single family homes.  Some golf courses to search are Brookwood (south side of Tienken, east of Brewster) Pine Trace (north of South Blvd, east of Adams), Katke-Cousins (Oakland University), R&S Sharf (Adams, south of Butler Rd), Hampton (Barclay Circle, Rochester Rd), Westwynd (Adams, Gunn in Oak Twp), Blackheath (Rochester Rd north of downtown), Myth (Stoney Creek Rd, Oak Twp) and Stony Creek Metropark.

Large property lots, over 1 acre, are difficult to find in the city proper.  However, Oakland Township is a newer residential area where just 20 years ago it was farmland.  You may be able to find homes or property over one acre.

Rochester has schools of choice, but to get busing to a particular school, you will need to be in that school’s busing zone. Oakland Township also has Rochester schools. Rochester Hills has an additional school system called Avondale. To search for homes for a specific Rochester school, you can use the following attendance boundary maps online: https://www.rochester.k12.mi.us/pages/5055/attendance-maps

If you are looking for a “deal” here, you will be disappointed because properties are at premium prices. If you are looking to rent a home instead of buy, you can expect to pay about $1 per square foot and up.


Ruth Berklich is a Rochester Realtor with Keller Williams and can be reached at (248) 515-0703 or (248) 609-8000

When you interview listing agents, this is what they SHOULD do for you

If I lose a lead to another agent, I investigate what that agent is doing for the client. When it turns up that the agent used his/her cell phone or a cheap camera for photos or lists the home way too high or too low, I just shake my head wishing I could have educated that homeowner before that agent reached him.

When you interview a Realtor, ask the following questions.

Will you use a professional photographer? If they were thinking no, they will usually say yes now.  We can get photographers in my market for $75-$200 for most homes over $150k.  Let me tell you that professional photos draw in the BEST qualified buyers willing to pay the highest price for the homes with those beautiful, magazine-like photos every time! Those photos create a mood that every home should project to buyers. Don’t even think about accepting an objection that their phone or camera takes excellent photos because they don’t and they are not trained to take them.

How will you market my home? The first two weeks are critical for marketing and advertising a new home listing, so every effort will bring buyers faster.

Every Realtor in a professional brokerage will list on the MLS which gets picked up by all of the major home sites such as Realtor.com, Zillow, Trulia, etc.

The agent should state that they will advertise your house on social media that focuses on your target market (the people who will buy your home).  The most popular are Facebook, Instagram, Google Plus, Linked In, community pages and many others.

An email system for agents will directly contact agents in the area of your home who may have buyers. We love this system because we can get there faster with clients when the home has not yet hit the MLS or if it is a pocket listing.

Full color flyers or brochures should be created for buyers to take with them as they tour your home (placed on kitchen counter).  Some buyers’ agents will show 5-10 homes at a time and you want your home to stand out in their memory over other homes (people always forget what they saw when shown too many homes at once, and the memory fades over days.)

YouTube Videos/Video Tours are always a treat, but not mandatory. Most of these are slide shows of the photos, but they present the home in a quick view and people like beautiful mini movies shown on social media. Homes on large properties should have drone photos or videos so that the land can be seen from the air in present time.

High end luxury homes may get a webpage dedicated to their home and will advertise the lifestyle of living there showing photos of the surrounding area shopping, best restaurants, schools, walking trails, parks, public transportation, athletics, etc.

Of course there are many other advertising media that agents may use, such as printed newspaper or online ads, but those usually just make the agent look good to attract future clients – and in this fast-paced sellers’ market, the homes are often sold before the print date.

Professionalism, knowledge and marketing, not necessarily years of experience, are key for great real estate sales.  I have seen agents with 20 years of experience use terrible photos, not market a home well, list too low/too high and have homes sit on the market.

You spend a lot of money to sell your home, so you should get more for what you pay to get the top seller dollar.


Ruth Berklich is a Realtor with Keller Williams, Rochester, Michigan.  She can be reached at (248) 609-8000.

Secrets no one tell you about updating your house to sellAs empty nester baby boomers, my husband and I are updating to sell and downsize next year.  Hopefully.  Maybe.  Between the arguments and the costs to update to get the best bang for our buck, the process has been….slow…to say the least.  We want to be “on trend” but are starting to hate the home improvement television shows because they make it look easy and affordable.

Are you going through the same process?

As a responsible Realtor, I have an appraiser on speed dial.  He has been in the business about 30 years and I am here to tell you that it seems “the business” changes its parameters every year. Because my husband and I have flipped several homes and I want to give my clients the best advice I can, I regularly take classes given by mortgage underwriters or appraisers.

What an eye opener those classes are — but they can be a real downers.

For instance, three years ago, an appraiser told me that a finished basement in the neighborhood where I was pricing a listing would get a $10k credit, but a finished walkout basement would get a credit of $15k.  It also did not matter if the owner paid $20k to finish it or $40k. Why?

Now, I have seen homes with finished basements get $40k more on their sales price over homes in the same neighborhood without finished basements. This is called market price, or what buyers are willing to pay.  I do not recommend finishing the basement to sell because that is a very costly endeavor, and if done, the ROI may be, at the highest, about 70-75 cents on the dollar.

When viewing finished basement homes, an appraiser can allocate small dollar amounts towards what people have included.  If the homeowner put in a bedroom, it must have at least a 7 foot long wall, rescue door or window, and a closet to be considered a bedroom (Michigan). An appraiser can give the seller about $10-$15 per square foot credit, but do not look for it in the actual appraisal because appraisers rarely do it. A basement bedroom cannot be in the above ground house bedroom count, but the listing agent can say “basement has an additional 4th bedroom” on the sales verbiage to attract more buyers. (Michigan)

Most buyers in my market want a bathroom in a finished basement. Best bet is to install a full bath in case future buyers’ family members will spend time living there – which is a latest trend – extended families in one home. Buyers will also look for kitchenette bars.

Which is worth more money, a 3 or 4 bedroom house of the same square footage in the same neighborhood? They are the same in an appraisal value, but a buyer may pay a higher price for a 4 bedroom. Years ago, the extra bedroom could get a higher appraised value. Recently, I have seen many 2 bedroom homes getting the same market price as 3 bedroom homes, whereas the price was less for them years ago – a perk of the extreme sellers’ market that we have now.

An appraiser will not give a higher dollar value to wood floors over carpet or laminate, but buyers will.  Same with granite counter tops.  If you put in the nicer upgrades, you will generally draw more buyers who are willing to pay a higher price.

Roof replacement – yes, if it only has about 5 or less years left on it. Generally, old roofs are single dimensional and are easily spotted in neighborhoods that have already gone to 3D. Buyers notice this immediately.  An inspector will tell the buyer that the roof only has a max of 5 years left on it which may affect buyer purchase decision.  Sellers will get a high ROI from a new roof install, but an even greater hit in reduced buyer price if not.  Realtors have stories about how many times they did not get good offers on a house because buyers were turned off by old roofs.

Luxury home buyers want updated tile in baths and kitchens. The 4×4 tile that the builder installed in the bathrooms is out. That subway tile seen on TV is not a show stopper in my market, but the latest designer ceramic and porcelain styles are.  Porcelain is usually less expensive than ceramic and I put it into my own master bath. (I admit I saw the long, grey tile on two home improvement shows and I like it.)

Why did X house sell for $300k and Y house of the same size in the same neighborhood sell for $225k?  The Y house either backed to a busy road, was not updated after 20 years, had bold paint colors in every room, had what is called functional obsolesce (ie no bathrooms on the same floor as the bedrooms), or economic obsolesce (ie yard faces the back of a grocery store). There are many reasons why one house sells higher than another.

Today’s buyers are “HGTV trained” and may not be able to afford out of pocket upgrades. They may look for a home that already has what they want, even if they need to pay a higher price.

The latest trends may be gone in ten years. When considering updates to sell, ask a local Realtor what trends are the hottest, then do the most affordable for your budget.  We see what sells the fastest for the most money every day in our markets, and the TV home shows aren’t always applicable.  Ship lap? I recently saw a new home buyer rip out all of the ship lap put in a home only a few years earlier.

Finally, buyers love the smell and sight of fresh, neutral, satin paint.  It’s like an attraction hormone or something.

Wells, that’s my two-cents.  Good luck!  I can’t wait to see what you have done!

Ruth Berklich is a Buy/Sell Realtor with Keller Williams, Rochester, MI.  She can be reached at (248) 609-8000 or rberklich@kw.com



My challenge for builders – create an affordable condo community for $250k or less

From what I have been told, builders have said that due to the high cost of land, materials and workers, there is no way to build an affordable community for first time home buyers or retirees under $250,000 per unit.

I beg to differ. Check your high ROIs at the door.

Look at some of the long term builders who have properties across the country.  How did they do it in the 70’s?  A national builder in my area, Who Shall Not Be Named, used less expensive materials such as in cabinets and countertops, built on slabs and found that price point in which buyers were willing to pay, offering options to upgrade even when the low price package wasn’t bad. That’s how they survived when other builders went bankrupt.

Another problem is the response from buyers. Somewhere along the line, buyers have gotten HGTV spoiled. This is what Realtors hear all day in my expensive suburbia:  I want an on-trend kitchen with granite counter tops, wood floors (will settle for re-engineered), 3-4 bedrooms, an office space, newer tiled 2 bathrooms, a finished basement with entertainment area/kitchen/bar. This cannot be built here in southeast Michigan for $250k and buyers expect to get it from resales.

Since I am a member of the Over 50 and Fabulous Crowd, I want to downsize, but the retirement communities around me start leasing at over $3,000 per month, or purchase at $300k and up. How is this affordable on retirement income for most people? Not sure I will be able to retire. I will probably work at my desk until someone rolls me out the door.

Now that my kids are out of the house, I want to downsize from a two story to a small ranch house (stairs are now the enemy for knees and laundry) that I can pay off in a 15 year mortgage just in time for retirement. But like many of my anticipated sellers, there is Sticker Shock. Why move if the next house is just as expensive? One result is that my market is down 30 percent in home listings because the Boomers aren’t budging.

So I have designed a little dream complex for people like me. You can call me a Stepford Wife, but I think I could be happy here.

Here’s the plan I challenge builders to design at $250k per unit.  Tell us the price point for the land, and we Realtors will find it.

There would be duplex condos with cathedral ceilings,  2 bed/2bath, central air, office space, 2 car garage with workshop and storage shelving, paver patios, no basements, walk in closets, open concept, all handicap designed if senior community, and guest parking.

floorplan revised picture

¨ In front of the community is a privately owned Minimart grocery store, a restaurant, and a small coffee shop.

¨ Community is shaped in a U with Duplex homes around the drive, woods in the surrounding area.

¨ Community building has a weight room, bathrooms for the swimming, and an open room with Wi Fi available and a media projector for movie nights

¨ Outdoor pool is zero walk in, goes to 5 ft deep, no diving.

¨ Playground for visiting children/grandchildren

¨ Dog park area (dogs under 40 pounds, one pet per household)

¨ Full time contract maintenance person daily for community house, pool, and exterior condo maintenance, playgrounds

¨ Monthly resident board appoints a volunteer community activities planner. Residents volunteer to oversee activities.

¨ Contracted management company oversees maintenance person and association fees, meets with resident board.


Untitled design (3)


That’s my two cents.  There are communities in my area already doing this for over $300k homes, so I’m sure the architects can fix my flaws and come up with a plan.

Any builders up for the challenge?

To sell or not to sell, that is the question

just thinking about selling

Mortgage interest rates are low, the sellers’ market is causing home prices to soar another 5 percent, unemployment has decreased and there are a lot of buyers looking for homes.

Facing an extreme sellers’ market in my area, Realtors are frustrated. Why aren’t sellers listing? Where are the homes for my buyers?

Buyer agents and their clients are encountering multiple offer situations, offers far over asking price, high cash offers, and no chance to offer before sold – in some areas homes sold within hours or before the MLS hits the Internet.

What is holding sellers back in this incredible market?  Seems to me that the top reasons to SELL NOW blasted all over the news do not address the reasons why people want to stay in their current homes.

One reason not to sell is that homeowners like where they live. We are encountering this issue here in Rochester, Shelby Township and Lake Orion.  We have the lakes, the shopping, safe neighborhoods and great schools – why leave?

He’s another hurdle:  If a seller is considering putting his updated ranch on the market for $250,000, he needs to prepare to pay over $300k for a larger home that may need a little work. Huh, that’s a tiring thought after all of the work he has put into his current house. What he wants may not be available, bigger isn’t always better, and the sticker shock may keep him away. He starts to think his current house isn’t so bad after all.

The thought process continues to go around and around.  Sellers think their houses need work before they can sell because they watch too much HGTV, or a someone has told them they will get low-balled if the house isn’t updated. If buyers can pony up more money to pay over asking price/appraisal, they can certainly afford to pay for new carpeting or kitchen counter tops. Even if the home is in the FHA price range of $280k or less, buyers know they will update when they can afford to do so since buyers have very little savings for the purchase. The extreme shortage of homes still puts the home that needs some work into an advantageous selling position.

“We will die in this house,” was a quote from a gentleman who I thought would like to consider selling his house.  The house was very large for two elderly adults and it needed extensive work. The thought of having any house payment other than annual taxes after so many years of not having a mortgage is not always feasible/acceptable for people on fixed incomes. Even if they sold the house and cashed in the equity to purchase a smaller, more manageable home/condo, the thought of the moving process can be overwhelming and costly.

My husband and I are on the fence. We are the “house needs more work” and “we like where we live” people. We are also becoming “empty-nesters in a large house.”  If we could find the elusive, affordable ranch with a pole barn on acreage with a short commute, we might light a fire under our behinds to sell — but the ranch might sell before we can get to it.


Ruth Berklich is a buy/sell Realtor with Keller Williams Rochester-Troy, MI (248) 609-8000


How your $35k kitchen makeover gets reduced to $10k max



Being a price analyst was ingrained when I worked as an analyst for a bank, and as a marketing manager for a construction contractor.  I never got away from excel spreadsheets.

Now I use my spreadsheet-toting, sales persona as a Realtor.  The latter is exciting, but the former can be a let down to homeowners.

Like the listing that just popped up on the MLS today: the homeowner purchased the property in 2015 for $475k (good price, very nice home), and just listed it at just under $600k because, I assume, he wants to get back all of the money that he spent in landscaping, kitchen, and painting updates.  Another home in the sub is doing the same, sitting at the same price for 18 months now.   Will the real agent agents educate them? All around these two there are new homes in the same price range selling like hot cakes.

I recently completed a very interesting appraisal update seminar, and though not much of the data was a surprise, it didn’t paint a pretty picture for home values like all of the articles home sellers have read  — 4 percent home value increases YoY and an extreme sellers’ market.

So you won’t harm the next Realtor who prices your home for sale, I wanted to let you in on some of the truths that we have known for years, but most have trouble breaking to clients in this “extreme sellers’ market” in Michigan.

  • That beautiful, wooded 10 acre property you purchased in which to build your dream home can only hold 30 percent of the total market value since you built a home on it.  Take for example, the 11 acres bought for just under $600k, then 15 years later sold for $345k with a house.  I had a client that tried to sell his home on over 30 acres for several years but no one wanted to pay the price.  We split the property into tilled farm land and 5 acres for the house. He sold the farmland immediately at a good price, and he may make about $50k more on the two deals over the full 30 that he could not sell.
  • Your stunning, spa-like, master bathroom that cost $20k to put together with a contractor, will get only a $2-$3,000 increase in value appointed to it by the bank appraiser. (The other homes in your comps have updated bathrooms too.)
  • The kitchen that cost $30k in new cabinets and ceramic flooring will get a maximum of $10k value increase.  This is why we say to have your cabinets painted (the new trend) and put in new appliances (about $4,500 for stainless).
  • Buyers love that third garage!  All $5,000 of it.
  • The fully finished in-law quarters you built in the basement will get only $10-$15 per room square foot, but the full bath can get the $2-$3k as mentioned.
  • Remember how golf course properties seemed higher in value?  They’re not.
  • Placement of the property may have “external obsolescence” issues such as next to a busy road, cemetery, school or a busy shopping mall.  One luxury home in my sub just lost about $30k in value because it backs to a busy road.
  • Your home will be compared to others in your neighborhood, and then up to one mile as the crow flies, unless you have a very unique home or home sales are almost nil.
  • There is no comp value on schools or their districts.
  • Favorite homes to mortgage by banks include #1) ranches #2) colonial # 3) bi/tri/quads. Surprised? You shouldn’t be since ranch homes are the hottest selling homes on the market (millennials and downsizers love ranches).
  • Pool? No value unless the property is in an affluent subdivision, so maybe $10k value add. It does not matter that you have a cute dolphin tiled on the bottom.

I could go on, but sarcasm runs strong in this one as I pay a $4,500 tile bill and look at a $10k deck replacement estimate on my own home.

Yet I want to remind you of the 2006/07 crash, and what it did to banks. From what I am told, appraisers value properties conservatively for banks or they risk losing their jobs.

As the old adage says, build what you will enjoy, but don’t expect a return value.

So when you meet with a Realtor for a market value price to sell, don’t sling shot the messenger.

Ruth Berklich is a buy/sell Realtor with Keller Williams Rochester/Troy Michigan. She can be reached at (248) 609-8000.