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updated: 2/10/2012 7:15 PM

On homes and real estate: Did new owner overpay?

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Q. I bought a house this summer, and in light of the National Association of Realtors' admission that they've been overstating home sales since 2007, I'm wondering if that faulty data may have made me overpay for my house.

A. The National Association of Realtors found that for some years, it made mistakes in reporting the number of sales, not sale prices. If your home was exposed on the open market and other buyers knew about it, you can be pretty sure you paid market value. And don't forget your lender's appraiser reported that the property was worth enough to act as security for your mortgage loan.

Q. We have a 3,750-square-foot house, built in 1877, in a neighborhood where some of the larger houses have been turned into apartments but where most are still single family. We are legitimately zoned as a two-family home because we have a small one-bedroom apartment with a separate entry but with easy access to the main space. Our tenant has recently moved out, and we'd like to remodel the space.

We plan on retiring to another location in three to five years and want to remodel in a way to make the house more salable. We're considering two choices: Upgrade the apartment for continued rental income as a one-bedroom apartment or turn the space into our own master suite with a full bath, walk-in closets, a sitting area and a mini-kitchen. In your opinion, which option would be most attractive to a potential buyer?

A. You're going to get my usual advice, which is to consult a local real estate agent.

Call a brokerage and ask to speak to the managing broker, who will be the most experienced. It should be possible to get free advice at no obligation from agents who are familiar with buyer expectations in your neighborhood. They'll have better answers than I would.

Q. We are relocating to a resort area and have a buyer for our home up north. It was our first home, and we lived there 45 years. Would you explain what we should expect regarding taxes?

A. Because you will have owned and occupied your present home for at least two of the five years before you sell it, you can take advantage of the home-seller's tax exclusion. The IRS will not charge any capital gains tax on profit up to $1 million. I expect that will cover it. (For a single taxpayer, the limit would be $500,000.)

Q. I read your recent comments on selling a timeshare and contacted several brokers in the area where I own a timeshare (western Massachusetts). None of the Realtors list timeshares, and one even said his attorney suggested that he not do so. I'm not looking to make a profit on it but just interested in getting rid of it. Another Realtor suggested selling it on Craigslist. What's your take on this idea?

A. You'll notice that contacting agents was not among my recommendations for shedding a timeshare. Even if yours had some value, there wouldn't be enough to pay for a broker's time and effort.

I assume you've already asked the management company if they'd take it back. Sometimes that works. If you don't owe anything on your timeshare -- no mortgage or back maintenance fees, there's nothing wrong with trying to give it away on Craigslist. You could list it in the region where it's located and also locally.

Q. My partner and I own our house together equally. We have no mortgage. There are repairs we need to make, and we'd prefer not to take money from our IRAs, which would be considered taxable income and would reduce our principal. I will soon turn 62; my partner turns 62 the following year. Can we apply for a reverse mortgage when I turn 62 or must we wait until we're both 62?

A. To qualify for a reverse mortgage, all homeowners must be 62 or older. The amount you can borrow is based on the value of your home and your life expectancy. Because at such an early age you could expect to receive checks for many years to come, you would be offered a relatively small monthly amount.

If you're looking for a lump sum, it might be more efficient to go for a regular mortgage. That's assuming you have good credit and dependable income, neither of which is required, of course, for a reverse mortgage.

A HUD-approved housing counselor could help at this point. To find a local agency, look on NFCC.org or HUD.gov.

• Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (include a stamped return envelope), or readers may email her through askedith.com.

2011, Creators Syndicate Inc.

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