Monthly Archives: July 2008

Tax holiday this weekend

I just ran across an article entitled, “Back-to-school tax holiday this weekend in VA” While reading the PilotOnline.com and I was reminded of the fact that this weekend is the third annual Virginia back-to-school tax holiday.

Starting this Friday, August 1, those who are shopping for back-to-school supplies will receive an exemption from the 5% state sales tax.  Shoppers will save 5% on school supplies priced up to $20 per item as well as clothing and shoes priced up to $100.  Supplies such as crayons, paper, notebooks and pens are included, as are items such as aprons, diapers and bathing suits.  However, other accessories including briefcases and cosmetics will not be exempt.

According to surveys by the national Retail Federation, the average consumer is expected to spend approximately $594.24 on back-to-school shopping this year and the Virginia Department of taxation, estimates shoppers will save up to $4 million this year thanks to this tax holiday.  Last year, the total spent by the average consumer was $563.24.

This tax holiday comes at a time when many Virginians are paying higher gas and food prices, so it should be a welcomed savings for many parents.

In addition to tax-free school supplies, Richmond-area Wal-Mart stores also plan to offer tax-free purchases on electronics such as computers and televisions.  Besides Wal-Mart, about 12 retailers will be paying for the taxes on other non back-to-school items in hopes of motivating consumers.

If you have school-aged children, this weekend is a good time to get out there and save some money on those necessary back-to-school supplies.

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Virginia Beach-Norfolk-Newport News in top 66 places to buy

While reading some articles on the real estate section of MSN.com, I ran across an interesting ranking titled, “66 cities where buying makes sense“.  According to research from the National Low Income Housing Coalition and the Center for Economic and Policy Research, the Virginia Beach, Norfolk and Newport News area has ranked among the top 66 cities where it is a good idea for those with good enough credit to make the switch from renting to owning their own home.

According to this article, in 57 of the 100 most populous metro areas it is more expensive to rent a 3-bedroom apartment than it is to buy a typical low-priced home with a 6% loan.  A low-priced home in this case is one that is priced at 75% of the area’s median price.  The article also states that if someone were to buy a low-priced home in the Virginia Beach, Norfolk or Newport News, they would build $10,449 dollars in equity by 2012, considering they were approved for a 6% loan.  If some one could only qualify for 7 or 8% interest, they would build $8,515 or $6,842 worth of equity respectively.

It is important to note that this does not mean it is a good time to buy a house as an investment, but rather that those who qualify for low financing could potentially save money every month by paying a mortgage on a low-priced home as opposed to renting.  Another upside is that they could build some equity over the next 3.5 years.  Depending on your credit score and current rent expenditure, you could pay less per month by buying a low-priced home than renting a three-bedroom apartment.

The National Low Income Housing Coalition and the Center for Economic and Policy Research have put out a report entitled, “Ownership, Rental Costs and the Prospects of Building Home Equity, An Analysis of 100 Metropolitan Areas“.  Anyone who is going to weigh the pros and cons of buying versus renting should take a look at this short report before deciding which is the better route for them.

When deciding whether you should buy a house, you should consider all of the variables.  Each case is different, while it may be a good time to buy for some, for others it could be a better idea to wait a bit.  Before you make the important decision to buy or wait for market conditions to improve, be sure to get all of the information that you need to make a sound decision.

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