Monday, November 22, 2010

Home Sales and the Post-2012 Medicare Contribution Tax - Spread Gain of Residential Sale Over 2+ Years

Article Link: Here

Home Sales and the Post-2012 Medicare Contribution Tax

by Ken Weissenberg

A recent Congressional Research Service (CRS) Report tries to reduce fears that the 3.8% Medicare contributions tax on unearned income (added by the Health Care and Education Reconciliation Act of 2010) effective for tax years beginning in 2013, is a “real estate” or “home sales” tax. As noted below, part or all of the gain on the sale of a residence will be subject to this new tax, along with many other items of passive income.

The Medicare contribution tax is a 3.8% additional tax that is imposed on individuals, estates and trusts on the lesser of (i) unearned income and (ii) Modified Adjusted Gross Income (MAGI) in excess of a threshold amount. The threshold amount for married individuals filing jointly is $250,000 ($125,000 if filing separately) and $200,000 for all others.

The CRS report stresses that the tax is not limited exclusively to real estate transactions and does not apply to the portion of gain which is excluded from tax under Internal Revenue Code section 121. Currently, under code sec 121, when a taxpayer sells his or her principal residence, there is an exclusion from taxable income of up to $250,000 of the capital gain if single or $500,000 if married filing jointly. Certain ownership and use tests must be satisfied to qualify for the exclusion. Gains in excess of the section 121 exclusion will be treated as capital gain for regular tax purposes and investment income for purposes of the 3.8% Medicare tax. However, given the exclusion amount only a limited number of taxpayers would be affected, especially since many home owners have experienced a decline in the value of their homes in recent years. It should be noted that gains on the sale of second homes (i.e., those which are not a principal residence) will not be eligible for the exclusion and may very well be subject to the 3.8% Medicare tax, in addition to the regular income tax.

If you are planning on selling a primary residence with a significant gain in excess of the $250,000/500,000 or a second residence, it may be a better idea to sell before the end of 2012 to avoid this additional 3.8% tax. For sales after 2012, installment sales reporting may be helpful to spread the recognition of gain into more than one year. An installment sale would also spread the regular capital gains tax over more than one year, but you are also delaying the receipt of the cash. An unknown is what would happen if you made an installment sale of a home in 2012 with some of the proceeds payable in 2012. Would the portion of the gain reportable in 2013 for regular tax purposes be subject to the 3.8% Medicare tax?

Finally, for regular tax purposes a loss on the sale of a personal residence is not deductible. Will the same rule apply to the 3.8 % Medicare tax or can that loss be used to reduce the tax on other investment income?

Posted via email from Brian Gibbons REISkills.com's posterous

Monday, October 25, 2010

Excerpt from The 100/0 Principle, by Al Ritter

Excerpt from The 100/0 Principle, by Al Ritter

What is the most effective way to create and sustain great relationships with others? It’s The 100/0 Principle: You take full responsibility (the 100) for the relationship, expecting nothing (the 0) in return.
Implementing The 100/0 Principle is not natural for most of us. It takes real commitment to the relationship and a good dose of self-discipline to think, act and give 100 percent.
The 100/0 Principle applies to those people in your life where the relationships are too important to react automatically or judgmentally. Each of us must determine the relationships to which this principle should apply. For most of us, it applies to work associates, customers, suppliers, family and friends.
STEP 1 – Determine what you can do to make the relationship work…then do it. Demonstrate respect and kindness to the other person, whether he/she deserves it or not.
STEP 2 – Do not expect anything in return. Zero, zip, nada.
STEP 3 – Do not allow anything the other person says or does (no matter how annoying!) to affect you. In other words, don’t take the bait.
STEP 4 – Be persistent with your graciousness and kindness. Often we give up too soon, especially when others don’t respond in kind. Remember to expect nothing in return.
At times (usually few), the relationship can remain challenging, even toxic, despite your 100 percent commitment and self-discipline. When this occurs, you need to avoid being the “Knower” and shift to being the “Learner.” Avoid Knower statements/ thoughts like “that won’t work,” “I’m right, you are wrong,” “I know it and you don’t,” “I’ll teach you,” “that’s just the way it is,” “I need to tell you what I know,” etc.
Instead use Learner statements/thoughts like “Let me find out what is going on and try to understand the situation,” “I could be wrong,” “I wonder if there is anything of value here,” “I wonder if…” etc. In other words, as a Learner, be curious!
Principle Paradox
This may strike you as strange, but here’s the paradox: When you take authentic responsibility for a relationship, more often than not the other person quickly chooses to take responsibility as well. Consequently, the 100/0 relationship quickly transforms into something approaching 100/100. When that occurs, true breakthroughs happen for the individuals involved, their teams, their organizations and their families.

This is not easy, but if you want something badly enough, you can serve and wait for results.

Posted via email from Brian Gibbons REISkills.com's posterous

Stock Market Advice & Picks, Penny, Small Cap, Micro Investments - Profit Confidential

The Latest Punch to the Gut: Foreclosures Fraud

By Inya Ivkovic, MA

foreclosures fraudMany Americans facing foreclosures on their homes are starting to believe they may not have to leave their homes, because questions have arisen as of late about lenders and whether they have followed all the foreclosure rules. If they have not, then seizures may be halted until the regulators get to the bottom of it all. But is it really a relief, is it simply postponing the inevitable, or are these foreclosure irregularities perhaps going deeper and threatening the overall recovery?

Attorneys general in as many as 40 states so far have started investigations into home foreclosure procedures and many lenders seem to have been caught in the net of providing foreclosure documents that have not been properly validated. Executives appear to have signed hundreds of thousands of documents without actually checking any loan records or having even the basic knowledge about who owns specific mortgages.

The defense of some of the lenders is that, while there may have been some procedural errors, the underlying transactions have not been fraudulent. This is hard to believe; if the lenders are not familiar with the details of specific loans, how can they be sure such loans are not fraudulent? In the meantime, the pressure is mounting. As foreclosure levels have reached record highs in the U.S., the U.S. government has had to say something, pressuring the lenders to reduce their eviction rates. But lenders, many of them having benefited from the billions of dollars in bailout money, are quite adamant on getting their loans back, one way or another.

Regardless, suspicions are mounting that lenders facing an exorbitant number of foreclosures have taken one shortcut too many trying to collect as much money as they could before the lending market truly imploded. According to RealtyTrac, just in August, lenders have taken possession of 95,364 California homes and served eviction notices on 338,836 more.

The problem is if these deficiencies are as widespread as 40 attorneys general think they are, hundreds of thousands of foreclosures could be tied up in courts for years, including the evictions already executed as well. If that happens — and it seems right now that the problem might be turning into an avalanche — economic recovery in the U.S. could be further delayed. There is simply no way getting the economy to start moving again without resolving foreclosure issues first.

The foreclosures fraud highlights another problem — the “shadow inventory.” If the homes now in default flood the market, which is a distinct possibility, real estate prices could be further depressed. If potential buyers, who are already scarce, believe that prices have not yet hit rock bottom, the will keep on waiting to get into the market and the U.S. real estate market will continue being nothing more than barren wasteland.

As for the resale homes turnover rate, the data point to an even more dismal picture. Data collected from 23 states where faulty foreclosures are now flooding the courts indicates that the average time between borrowers defaulting on their loan payments and sales of their homes has widened to 25 months in August of this year from 18 months reported in August 2007, at the onset of the financial crisis that has led to the crash of 2008.

The widening of the turnaround time is not only having an adverse impact on resale prices, but it may also serve as a signal to other stressed borrowers that it may be okay to stop paying, because their cases could also end up in courts for years. Considering the number of foreclosures, lenders are very likely to deal with the worst-case scenarios first and leave delinquent homeowners of less valuable properties in their homes longer.

Even when defaulting borrowers are trying to find a resolution and renegotiate their loans, they are hitting six-foot-tall brick walls. In far too many cases, no one can tell them who owns their mortgages, let alone how to go about refinancing them.

Posted via email from Brian Gibbons REISkills.com's posterous

Friday, October 1, 2010

Wells Fargo Nixes Extensions For Short Sale Close Dates and Trustee Sale Postponements

Wells Fargo Nixes Extensions For Short Sale Close Dates and Trustee Sale Postponements

This was forwarded to me by my good friend Patricia Platt of Old Republic Title

“Due to recent industry changes, we at Wells Fargo will no longer be granting any extensions for short sale close dates or postponing foreclosure/trustee sale dates. If you were issued an extension letter dated 9/14 or earlier, those extension letters will be honored, but no further extensions will be granted. Files must close by expiration date on the original approval letter or they will be removed. If your approval expires 9/15 or 9/16, you will have 48 hours to get me the final HUD for approval and close.”

What this means for short selling:

Time is of the essence. While it previously normal for banks to grant multiple  extensions to the short sale approval and the Trustee Sale postponement this will not occur with Wells any more.  All parties must process the short sale in an expeditious manner.
Other banks may follow suite. We will be tracking this an updating you on this blog.
The game is constantly changing. This change further illustrates that the standards for short sales are in a continuous flux.

Posted via email from Brian Gibbons REISkills.com's posterous

Thursday, September 16, 2010

"Wait to Worry". I tried to drown my worries with gin, but my worries are equipped with flotation devices,

"Wait to Worry"
An Excerpt from
Attitude is Everything
by Vicki Hitzges

I used to worry. A lot. The more I fretted, the more proficient I became at it. Anxiety begets anxiety. I even worried that I worried too much! Ulcers might develop. My health could fail. My finances could deplete to pay the hospital bills.

A comedian once said, "I tried to drown my worries with gin, but my worries are equipped with flotation devices." While not a drinker, I certainly could identify! My worries could swim, jump and pole vault!

To get some perspective, I visited a well known, Dallas businessman, Fred Smith. Fred mentored such luminaries as motivational whiz Zig Ziglar, business guru Ken Blanchard and leadership expert John Maxwell. Fred listened as I poured out my concerns and then said, "Vicki, you need to learn to wait to worry."

As the words sank in, I asked Fred if he ever spent time fretting. (I was quite certain he wouldn't admit it if he did. He was pretty full of testosterone-even at age 90.) To my surprise, he confessed that in years gone by he had been a top-notch worrier!

"I decided that I would wait to worry!" he explained. "I decided that I'd wait until I actually had a reason to worry-something that was happening, not just something that might happen-before I worried."

"When I'm tempted to get alarmed," he confided, "I tell myself, 'Fred, you've got to wait to worry! Until you know differently, don't worry.' And I don't. Waiting to worry helps me develop the habit of not worrying and that helps me not be tempted to worry."

Fred possessed a quick mind and a gift for gab. As such, he became a captivating public speaker. "I frequently ask audiences what they were worried about this time last year. I get a lot of laughs," he said, "because most people can't remember. Then I ask if they have a current worry - you see nods from everybody. Then I remind them that the average worrier is 92% inefficient - only 8% of what we worry about ever comes true."

Charles Spurgeon said it best. "Anxiety does not empty tomorrow of its sorrow, but only empties today of its strength."

Most of us want to be positive. It's advantageous to possess a sunny outlook. Doors open to optimists. They make friends, earn respect, close sales, produce loyal clients, and others enjoy and want to be like them. The question is how can we do that consistently?

That's what Attitude is Everything is all about! It's filled with great stories, great quotes and many "a-ha" moments that will turn the switch from "off" to "on." Not only will you love it, anyone you give it to will love it too! It's a perfect gift for any occasion for friends, family and employees.

To learn more about how to stay positive, just click here to view the book!

Also, to celebrate Simple Truths' 5th anniversary, this book, as well as all our other products, are on sale for 30% off our regular price. There is no minimum order to qualify. Simply add items to your cart and your savings will be automatically applied.

As an added bonus today only, enjoy free ground shipping on all U.S. orders of $50 or more.

Offer expires: 09/20/2010 at 11:59pm CST

All the Best,
Mac Anderson
Mac Anderson
Founder, Simple Truths

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Posted via email from Brian Gibbons REISkills.com's posterous

Wednesday, September 15, 2010

10 Reasons To Buy a Home - MarketWatch

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By Brett Arends , The Wall Street Journal

Enough with the doom and gloom about homeownership.

Sure, maybe there's more pain to come in the housing market. But when Time magazine starts running covers that declare "Owning a home may no longer make economic sense," it's time to say: Enough is enough. This is what "capitulation" looks like. Everyone has given up.

After all, at the peak of the bubble five years ago, Time had a different take. "Home Sweet Home," declared its cover then, as it celebrated the boom and asked: "Will your house make your rich?"

But it's not enough just to be contrarian. So here are 10 reasons why it's good to buy a home.

1. You can get a good deal. Especially if you play hardball. This is a buyer's market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We're four to five years into the biggest housing bust in modern history. And prices have come down a long way– about 30% from their peak, according to Standard & Poor's Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it's mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You'll never catch the bottom. It doesn't really matter so much in the long haul.

Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%.

2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What's not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won't see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.

3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you'll get a tax break on capital gains–if any–when you sell. Sure, you'll need to do your math. You'll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.

4. It'll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extension–zoning permitted–or paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You'll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. "You can tell the ones that have been bought," said my local guide. "They've painted the front door. It's the first thing people do when they buy." It was a small sign that said something big.

5. You'll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you're better off buying.

6. It offers some inflation protection. No, it's not perfect. But studies by Professor Karl "Chip" Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.

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7. It's risk capital. No, your home isn't the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantities–for practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economy–if it happens–and still managing to sleep at night.

8. It's forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won't. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn't a cost. You're just paying yourself by building equity. As a forced monthly saving, it's a good discipline.

9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That's below last year's peak, but well above typical levels, and enough for about a year's worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.

10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyed–either deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slump in western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the "glut" simply won't matter: It's concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won't have any long-term impact on housing supply in your town.

Write to Brett Arends at brett.arends@wsj.com

Watch where you live. This is true is certain areas. NY, Calif, NV, AZ, FL, MA, CT, and others, some will fall more than 10-15%.

Posted via email from Brian Gibbons REISkills.com's posterous

Video - Three Years After the Collapse, Some Perspective

Video - News Hub: Top Reasons to Buy a Home Now

Not everywhere it is a good time.

Posted via email from Brian Gibbons REISkills.com's posterous

6 Career-Killing Facebook Mistakes - Investopedia Slideshows

6 Career-Killing Facebook Mistakes

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6 Career-Killing Facebook Mistakes

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From our advertisers:

Surveys suggest that as of 2010, approximately 30% of employers are using Facebook to screen potential employees - even more than those who check LinkedIn, a strictly professional social networking site. To avoid missing out on a career opportunity, avoid these common Facebook faux-pas. Read: 6 Career-Killing Facebook Mistakes

Filed Under: Business | Careers | Young_Investors

Posted via email from Brian Gibbons REISkills.com's posterous

Thursday, September 9, 2010

Housing Choice - Help Today’s Owners or Future Buyers - NYTimes.com

September 5, 2010

Housing Woes Bring a New Cry: Let the Market Fall

The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.

Over the last 18 months, the administration has rolled out just about every program it could think of to prop up the ailing housing market, using tax credits, mortgage modification programs, low interest rates, government-backed loans and other assistance intended to keep values up and delinquent borrowers out of foreclosure. The goal was to stabilize the market until a resurgent economy created new households that demanded places to live.

As the economy again sputters and potential buyers flee — July housing sales sank 26 percent from July 2009 — there is a growing sense of exhaustion with government intervention. Some economists and analysts are now urging a dose of shock therapy that would greatly shift the benefits to future homeowners: Let the housing market crash.

When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve.

“Housing needs to go back to reasonable levels,” said Anthony B. Sanders, a professor of real estate finance at George Mason University. “If we keep trying to stimulate the market, that’s the definition of insanity.”

The further the market descends, however, the more miserable one group — important both politically and economically — will be: the tens of millions of homeowners who have already seen their home values drop an average of 30 percent.

The poorer these owners feel, the less likely they will indulge in the sort of consumer spending the economy needs to recover. If they see an identical house down the street going for half what they owe, the temptation to default might be irresistible. That could make the market’s current malaise seem minor.

Caught in the middle is an administration that gambled on a recovery that is not happening.

“The administration made a bet that a rising economy would solve the housing problem and now they are out of chips,” said Howard Glaser, a former Clinton administration housing official with close ties to policy makers in the administration. “They are deeply worried and don’t really know what to do.”

That was clear last week, when the secretary of housing and urban development, Shaun Donovan, appeared to side with current homeowners, telling CNN the administration would “go everywhere we can” to make sure the slumping market recovers.

Mr. Donovan even opened the door to another housing tax credit like the one that expired last spring, which paid first-time buyers as much as $8,000 and buyers who were moving up $6,500. The cost to taxpayers was in the neighborhood of $30 billion, much of which went to people who would have bought anyway.

Administration press officers quickly backpedaled from Mr. Donovan’s comment, saying a revived credit was either highly unlikely or flat-out impossible. Mr. Donovan declined to be interviewed for this article. In a statement, a White House spokeswoman responded to questions about possible new stimulus measures by pointing to those already in the works.

“In the weeks ahead, we will focus on successfully getting off the ground programs we have recently announced,” the spokeswoman, Amy Brundage, said.

Among those initiatives are $3 billion to keep the unemployed from losing their homes and a refinancing program that will try to cut the mortgage balances of owners who owe more than their property is worth. A previous program with similar goals had limited success.

If last year’s tax credit was supposed to be a bridge over a rough patch, it ended with a glimpse of the abyss. The average home now takes more than a year to sell. Add in the homes that are foreclosed but not yet for sale and the total is greater still.

Builders are in even worse shape. Sales of new homes are lower than in the depths of the recession of the early 1980s, when mortgage rates were double what they are now, unemployment was pervasive and the gloom was at least as thick.

The deteriorating circumstances have given a new voice to the “do nothing” chorus, whose members think the era of trying to buy stability while hoping the market will catch fire — called “extend and pretend” or “delay and pray” — has run its course.

“We have had enough artificial support and need to let the free market do its thing,” said the housing analyst Ivy Zelman.

Michael L. Moskowitz, president of Equity Now, a direct mortgage lender that operates in New York and seven other states, also advocates letting the market fall. “Prices are still artificially high,” he said. “The government is discriminating against the renters who are able to buy at $200,000 but can’t at $250,000.”

A small decline in home prices might not make too much of a difference to a slack economy. But an unchecked drop of 10 percent or more might prove entirely discouraging to the millions of owners just hanging on, especially those who bought in the last few years under the impression that a turnaround had already begun.

The government is on the hook for many of these mortgages, another reason policy makers have been aggressively seeking stability. What helped support the market last year could now cause it to crumble.

Since 2006, the Federal Housing Administration has insured millions of low down payment loans. During the first two years, officials concede, the credit quality of the borrowers was too low.

With little at stake and a queasy economy, buyers bailed: nearly 12 percent were delinquent after a year. Last fall, F.H.A. cash reserves fell below the Congressionally mandated minimum, and the agency had to shore up its finances.

Government-backed loans in 2009 went to buyers with higher credit scores. Yet the percentage of first-year defaults was still 5 percent, according to data from the research firm CoreLogic.

“These are at-risk buyers,” said Sam Khater, a CoreLogic economist. “They have very little equity, and that’s the largest predictor of default.”

This is the risk policy makers face. “If home prices begin to fall again with any serious velocity, borrowers may stay away in such numbers that the market never recovers,” said Mr. Glaser, a consultant whose clients include the National Association of Realtors.

Those sorts of worries have a few people from the world of finance suggesting that the administration should do much more, not less.

William H. Gross, managing director at Pimco, a giant manager of bond funds, has proposed the government refinance at lower rates millions of mortgages it owns or insures. Such a bold action, Mr. Gross said in a recent speech, would “provide a crucial stimulus of $50 to $60 billion in consumption,” as well as increase housing prices.

The idea has gained little traction. Instead, there is a sense that, even with much more modest notions, government intervention is not the answer. The National Association of Realtors, the driving force behind the credit last year, is not calling for a new round of stimulus.

Some members of the National Association of Home Builders say a new credit of $25,000 would raise demand but their chances of getting this through Congress are nonexistent.

“Our members are saying that if we can’t get a very large tax credit — one that really brings people off the bench — why use our political capital at all?” said David Crowe, the chief economist for the home builders.

That might give the Obama administration permission to take the risk of doing nothing.

Posted via email from Brian Gibbons REISkills.com's posterous

The Benefits of Blowing Your Top - NYTimes.com


July 5, 2010

The Benefits of Blowing Your Top

The longing for President Obama to vent some fury at oil executives or bankers may run far deeper than politics. Millions of people live or work with exasperatingly cool customers, who seem to be missing an emotional battery, or perhaps saving their feelings for a special occasion. People who — unlike the mining operators in the gulf — have a blowout preventer that works all too well.

Sang-froid has its place, especially during a crisis; but so does Sigmund Freud, who described the potential downside of suppressed passions. Those exhortations being directed at the president could be just as easily be turned on countless co-workers, spouses, friends (or oneself):

Lose it. Just once. See what happens.

“One reason we’re so attuned to others’ emotions is that, when it’s a real emotion, it tells us something important about what matters to that person,” said James J. Gross, a psychologist at Stanford University. When it’s suppressed or toned down, he added, “people think, damn it, you’re not like us, you don’t care about the same things we do.”

Rigorous study of what psychologists call emotion regulation is fairly new, and for obvious reasons has focused far more on untamed passions than on the domesticated variety. Runaway emotion defines many mental disorders, after all; restraint is typically associated with good mental health, from childhood through later life.

Yet social functioning is a different matter. Research in the past few years has found that people develop a variety of psychological tools to manage what they express in social situations, and those techniques often become subconscious, affecting interactions in unintended ways. The better that people understand their own patterns, the more likely they are to see why some emotionally charged interactions go awry — whether from too little control or, in the president’s case, perhaps too much.

Most scientists agree that a person’s range of possible emotional expression is a matter of inborn temperament. Growing up is, in one sense, a living education in how to manage that temperament so it elicits help from others and does not torment oneself.

“As we grow, the prefrontal areas of the brain develop, and we become more biologically able to control our impulses as well,” said Stefan G. Hofmann, a professor of psychology at Boston University.

Psychologists divide regulation strategies into two broad categories: pre-emptive, occurring before an emotion is fully felt; and responsive, coming afterward. The best known of the latter category, and one of the first learned, is simple suppression. First-graders will cover a smile with their hand when a classmate does something embarrassing; in time, many become far more adept, reflexively masking surprise, alarm, even rage with a poker face.

Suppression, while clearly valuable in some situations (no laughing at funerals, please), has social costs that are all too familiar to those who know its cold touch. In one 2003 Stanford study, researchers found that people instructed to wear a poker face while discussing a documentary about the atomic bombings of Hiroshima and Nagasaki made especially stressful conversation partners.

In another, published last year, psychologists followed 278 men and women as they entered college, giving questionnaires and conducting interviews. Those who scored highest on measures of emotion suppression had the hardest time making friends.

“An individual who responds to the college transition by becoming emotionally guarded in the first few days,” the authors wrote, will most likely miss opportunities for friendships.

Pre-emptive techniques can work in more subtle ways. One of these is simple diversion, reflexively focusing on the good and ignoring the bad — rereading the praise in an evaluation and ignoring or dismissing any criticism. A 2009 study led by Derek Isaacowitz of Brandeis University found that people over 55 were much more likely than those aged 25 and under to focus on positive images when in a bad mood — thereby buoying their spirits. The younger group was more likely to focus on negative images when feeling angry or down.

More striking, Dr. Isaacowitz found in another study that older people were twice as likely as younger ones to be “rapid regulators” — people whose mood bounced back quickly, sometimes within minutes, after ruminating on depressing memories.

“We have found in general that older people tend to regulate their emotions faster, and are not as motivated to explore negative information, to engage negative images, as younger people are,” Dr. Isaacowitz said. “And it makes some sense, that younger adults would explore the negative side of things, that they need to and maybe want to experience them — to experience life — as they develop their own strategies to regulate.”

Socially speaking, in short, the ability to shrug off feelings of disgust or outrage may suit an older group but strike younger people as inauthentic, even callous.

Finally, people may choose the emotions they feel far more often than they are aware — and those choices, too, can trip up social interactions. A series of recent experiments led by Maya Tamir, a psychologist at Hebrew University in Jerusalem and at Boston College, has found that people subconsciously prime themselves to feel emotions they believe will be most useful to them in an anticipated situation. The researchers call these instrumental emotions.

In one experiment, published last year, Dr. Tamir and Brett Q. Ford of Boston College prepared participants to play a video game in which they would be hunted down by monsters. Before playing, the study volunteers rated what type of music they wanted to hear and what kind of autobiographical memories they preferred to recall.

They were much more likely to want to recall fearful memories, and to prefer to listen to ominous music, than others who were expecting to play a video game in which they would build a theme park or solve a simple puzzle. They were, the authors argue, adopting an emotion that would serve them well in the game.

Dr. Tamir has found similar results in a variety of situations, showing for example that people role-playing as landlords will ramp up their anger before confronting a tenant about late rent.

Mr. Obama’s analytical composure probably comes so easily because it has repeatedly served him well, Dr. Tamir said.

“If staying calm and patient and confident is what has worked for you in crisis situations in the past,” she said, “then subconsciously it may become automatic. And the more automatic it becomes, the less of the actual anger, or panic, you feel.”

All of which makes it a treacherous task to express the real thing, at exactly the moment and pitch that people expect. For people like the president, said Dr. Gross of Stanford, it means throwing the switch on two psychological systems at once: the habitual, analytical one (power down) and the instrumental one (power up).

“If that process interrupts expression even a little, people notice,” Dr. Gross said. “We have an exceptional capacity to track whether the timing and morphology of an emotion is correct.”

The most socially skilled among us — those who project the emotions they intend, when they intend to — are not wedded to any one strategy, Dr. Hofmann argues. In a paper published last month with Todd Kashdan of George Mason University, he proposed that emotion researchers adopt a questionnaire to measure three components of regulation: concealing (i.e., suppression), adjusting (quickly calming anger, for instance) and tolerating (openly expressing emotion).

“These are each valuable strategies, in different situations,” Dr. Hofmann said. “The people who get into trouble socially, I believe, are the ones who are inflexible — who stick to just one.”

Posted via email from Brian Gibbons REISkills.com's posterous

Mind - Research Upends Traditional Thinking on Study Habits

Every September, millions of parents try a kind of psychological witchcraft, to transform their summer-glazed campers into fall students, their video-bugs into bookworms. Advice is cheap and all too familiar: Clear a quiet work space. Stick to a homework schedule. Set goals. Set boundaries. Do not bribe (except in emergencies).

And check out the classroom. Does Junior’s learning style match the new teacher’s approach? Or the school’s philosophy? Maybe the child isn’t “a good fit” for the school.

Such theories have developed in part because of sketchy education research that doesn’t offer clear guidance. Student traits and teaching styles surely interact; so do personalities and at-home rules. The trouble is, no one can predict how.

Yet there are effective approaches to learning, at least for those who are motivated. In recent years, cognitive scientists have shown that a few simple techniques can reliably improve what matters most: how much a student learns from studying.

The findings can help anyone, from a fourth grader doing long division to a retiree taking on a new language. But they directly contradict much of the common wisdom about good study habits, and they have not caught on.

For instance, instead of sticking to one study location, simply alternating the room where a person studies improves retention. So does studying distinct but related skills or concepts in one sitting, rather than focusing intensely on a single thing.

“We have known these principles for some time, and it’s intriguing that schools don’t pick them up, or that people don’t learn them by trial and error,” said Robert A. Bjork, a psychologist at the University of California, Los Angeles. “Instead, we walk around with all sorts of unexamined beliefs about what works that are mistaken.”

Take the notion that children have specific learning styles, that some are “visual learners” and others are auditory; some are “left-brain” students, others “right-brain.” In a recent review of the relevant research, published in the journal Psychological Science in the Public Interest, a team of psychologists found almost zero support for such ideas. “The contrast between the enormous popularity of the learning-styles approach within education and the lack of credible evidence for its utility is, in our opinion, striking and disturbing,” the researchers concluded.

Ditto for teaching styles, researchers say. Some excellent instructors caper in front of the blackboard like summer-theater Falstaffs; others are reserved to the point of shyness. “We have yet to identify the common threads between teachers who create a constructive learning atmosphere,” said Daniel T. Willingham, a psychologist at the University of Virginia and author of the book “Why Don’t Students Like School?”

But individual learning is another matter, and psychologists have discovered that some of the most hallowed advice on study habits is flat wrong. For instance, many study skills courses insist that students find a specific place, a study room or a quiet corner of the library, to take their work. The research finds just the opposite. In one classic 1978 experiment, psychologists found that college students who studied a list of 40 vocabulary words in two different rooms — one windowless and cluttered, the other modern, with a view on a courtyard — did far better on a test than students who studied the words twice, in the same room. Later studies have confirmed the finding, for a variety of topics.

The brain makes subtle associations between what it is studying and the background sensations it has at the time, the authors say, regardless of whether those perceptions are conscious. It colors the terms of the Versailles Treaty with the wasted fluorescent glow of the dorm study room, say; or the elements of the Marshall Plan with the jade-curtain shade of the willow tree in the backyard. Forcing the brain to make multiple associations with the same material may, in effect, give that information more neural scaffolding.

“What we think is happening here is that, when the outside context is varied, the information is enriched, and this slows down forgetting,” said Dr. Bjork, the senior author of the two-room experiment.

Varying the type of material studied in a single sitting — alternating, for example, among vocabulary, reading and speaking in a new language — seems to leave a deeper impression on the brain than does concentrating on just one skill at a time. Musicians have known this for years, and their practice sessions often include a mix of scales, musical pieces and rhythmic work. Many athletes, too, routinely mix their workouts with strength, speed and skill drills.

The advantages of this approach to studying can be striking, in some topic areas. In a study recently posted online by the journal Applied Cognitive Psychology, Doug Rohrer and Kelli Taylor of the University of South Florida taught a group of fourth graders four equations, each to calculate a different dimension of a prism. Half of the children learned by studying repeated examples of one equation, say, calculating the number of prism faces when given the number of sides at the base, then moving on to the next type of calculation, studying repeated examples of that. The other half studied mixed problem sets, which included examples all four types of calculations grouped together. Both groups solved sample problems along the way, as they studied.

A day later, the researchers gave all of the students a test on the material, presenting new problems of the same type. The children who had studied mixed sets did twice as well as the others, outscoring them 77 percent to 38 percent. The researchers have found the same in experiments involving adults and younger children.

“When students see a list of problems, all of the same kind, they know the strategy to use before they even read the problem,” said Dr. Rohrer. “That’s like riding a bike with training wheels.” With mixed practice, he added, “each problem is different from the last one, which means kids must learn how to choose the appropriate procedure — just like they had to do on the test.”

These findings extend well beyond math, even to aesthetic intuitive learning. In an experiment published last month in the journal Psychology and Aging, researchers found that college students and adults of retirement age were better able to distinguish the painting styles of 12 unfamiliar artists after viewing mixed collections (assortments, including works from all 12) than after viewing a dozen works from one artist, all together, then moving on to the next painter.

The finding undermines the common assumption that intensive immersion is the best way to really master a particular genre, or type of creative work, said Nate Kornell, a psychologist at Williams College and the lead author of the study. “What seems to be happening in this case is that the brain is picking up deeper patterns when seeing assortments of paintings; it’s picking up what’s similar and what’s different about them,” often subconsciously.

Cognitive scientists do not deny that honest-to-goodness cramming can lead to a better grade on a given exam. But hurriedly jam-packing a brain is akin to speed-packing a cheap suitcase, as most students quickly learn — it holds its new load for a while, then most everything falls out.

“With many students, it’s not like they can’t remember the material” when they move to a more advanced class, said Henry L. Roediger III, a psychologist at Washington University in St. Louis. “It’s like they’ve never seen it before.”

When the neural suitcase is packed carefully and gradually, it holds its contents for far, far longer. An hour of study tonight, an hour on the weekend, another session a week from now: such so-called spacing improves later recall, without requiring students to put in more overall study effort or pay more attention, dozens of studies have found.

No one knows for sure why. It may be that the brain, when it revisits material at a later time, has to relearn some of what it has absorbed before adding new stuff — and that that process is itself self-reinforcing.

“The idea is that forgetting is the friend of learning,” said Dr. Kornell. “When you forget something, it allows you to relearn, and do so effectively, the next time you see it.”

That’s one reason cognitive scientists see testing itself — or practice tests and quizzes — as a powerful tool of learning, rather than merely assessment. The process of retrieving an idea is not like pulling a book from a shelf; it seems to fundamentally alter the way the information is subsequently stored, making it far more accessible in the future.

Dr. Roediger uses the analogy of the Heisenberg uncertainty principle in physics, which holds that the act of measuring a property of a particle (position, for example) reduces the accuracy with which you can know another property (momentum, for example): “Testing not only measures knowledge but changes it,” he says — and, happily, in the direction of more certainty, not less.

In one of his own experiments, Dr. Roediger and Jeffrey Karpicke, also of Washington University, had college students study science passages from a reading comprehension test, in short study periods. When students studied the same material twice, in back-to-back sessions, they did very well on a test given immediately afterward, then began to forget the material.

But if they studied the passage just once and did a practice test in the second session, they did very well on one test two days later, and another given a week later.

“Testing has such bad connotation; people think of standardized testing or teaching to the test,” Dr. Roediger said. “Maybe we need to call it something else, but this is one of the most powerful learning tools we have.”

Of course, one reason the thought of testing tightens people’s stomachs is that tests are so often hard. Paradoxically, it is just this difficulty that makes them such effective study tools, research suggests. The harder it is to remember something, the harder it is to later forget. This effect, which researchers call “desirable difficulty,” is evident in daily life. The name of the actor who played Linc in “The Mod Squad”? Francie’s brother in “A Tree Grows in Brooklyn”? The name of the co-discoverer, with Newton, of calculus?

The more mental sweat it takes to dig it out, the more securely it will be subsequently anchored.

None of which is to suggest that these techniques — alternating study environments, mixing content, spacing study sessions, self-testing or all the above — will turn a grade-A slacker into a grade-A student. Motivation matters. So do impressing friends, making the hockey team and finding the nerve to text the cute student in social studies.

“In lab experiments, you’re able to control for all factors except the one you’re studying,” said Dr. Willingham. “Not true in the classroom, in real life. All of these things are interacting at the same time.”

But at the very least, the cognitive techniques give parents and students, young and old, something many did not have before: a study plan based on evidence, not schoolyard folk wisdom, or empty theorizing.

This article has been revised to reflect the following correction:

Correction: September 8, 2010

An article on Tuesday about the effectiveness of various study habits described incorrectly the Heisenberg uncertainty principle in physics. The principle holds that the act of measuring one property of a particle (position, for example) reduces the accuracy with which you can know another property (momentum, for example) — not that the act of measuring a property of the particle alters that property.

Posted via email from Brian Gibbons REISkills.com's posterous

Wednesday, September 8, 2010

A quick peek at the retirement houses of tomorrow - MarketWatch

Jan. 25, 2010, 1:47 p.m. EST

Rough outlines

Economy forces changes in thinking about retirement homes

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By Steve Kerch, MarketWatch

LAS VEGAS (MarketWatch) -- If your idea of a dream retirement home is a luxury contemporary overlooking a championship golf course in the desert, you better be prepared for some mighty small block parties: When it comes to retirement living, golf courses are out.

And Arizona and Florida aren't the only retirement-relocation hot spots these days. In fact, South and North Carolina now top the preferences of baby boomers who will be retiring in the next decade, according to a survey to be released this week from home builder Del Webb.

A lesson in retirement saving

Veteran personal-finance writer Jane Bryant Quinn says parents should focus on retirement savings before kids' college costs, but the new Roth IRA rules can be a great way to benefit heirs. MarketWatch's Jonathan Burton reports.

"My how times have changed when it comes to the golf course," said Paul Cardis, chief executive of AVID Ratings Co., a survey research firm. His recommendation to builders: Eliminate it. Bike paths and walking trails are the new greens and fairways.

Blame it all on the economy. The recession has taken its toll not only on nest eggs but also on the traditional concept of a retirement home. That's the message that attendees at the International Builders Show here last week received in a number of presentations and seminars. See MarketWatch's Special Report: Retirement Outlook.

Downsizing is a trend that is taking hold among all housing consumers, but it is particularly evident among the 55+ crowd that includes the older baby boomers. Read more on the shrinking size of U.S. homes.

And that downsizing includes housing aspirations in retirement. While "warmer climate" was the reigning factor in choosing where to retire in the first boomer survey Del Webb conducted in 1996, today "cost of living" is the most important consideration on where to locate. Although Florida, Arizona and California remain Top 10 retirement destinations, the trend is giving other states a chance to draw even more retirees.

Despite the broadening of potential destinations, baby boomers' desire to move in retirement has remained relatively stable over the years. Between 30% and 40% plan to move to a new home in retirement, about the same as in 1996, and half of those plan on moving to a new state.

What older buyers want in homes

What kind of houses will be in demand among those 55 and older? According to a consumer survey conducted by the National Association of Home Builders, the most important design features that 55+ buyers want in their homes center on the practical:

  • Washers and dryers in their units

  • Storage space

  • Windows that open easily

  • Garage-door openers

  • Easy-to-use thermostats

  • First-floor master bedrooms

  • Private patios

  • Porches

  • Attached garages

  • Bigger bathrooms

A lot of the more popular features in new homes these days don't appeal all that much to older buyers:

  • Island work areas

  • Separate showers

  • Private toilet compartments

  • Sun rooms

  • Woodburning fireplaces

  • Exercise rooms

But a number of items that home buyers overall don't find to be of much interest are much more popular with older buyers:

  • Bathroom aids such as grab bars

  • Kitchen aids

  • Light home-repair services

  • Outdoor maintenance services

  • An entrance without steps

  • Accessible public transportation

  • Wider doorways

  • Nonslip flooring

Among technology features, older home buyers tend to act like younger buyers when it comes to the basics: Both groups have a preference for security systems, energy management, structured wiring and lighting controls. But older buyers had little use for home theaters, distributed audio or home automation, more-expensive items that younger buyers do like.

"These older buyers are frugal, probably on a fixed income and so expensive tech items are not that big on their lists," said Rose Quint, the NAHB assistant vice president for survey research.

Service stations

The emphasis on services related to home and community is an important one that cuts across many age groups, said John Migliaccio, director of research at MetLife's Mature Market Institute, which surveys consumers and builders on retirement issues.

"Very telling is that the younger group of mature consumers reported enthusiastically that they want services like home maintenance and repair as part of their next home purchase, along with services usually connected to older householders, such as housekeeping, onsite health care and transportation," he said.

According to Migliaccio, all of those items were ranked higher than the desire for social activities by this group -- a surprise given that social activities and amenities have been thought to be valued highly by this group. He said the data support an emerging trend among builders to look for ways to partner with providers of such services to the residents of their active adult/lifestyle communities.

Migliaccio also predicted that universal design -- which includes features such as wider hallways, lever-handled doors, roll-in showers and no-stair entries -- will catch on as baby boomers watch their own parents age. "The boomers are going to see their own parents age without it and they won't like what they see," he said.

The 55+ age group represents 38% of all U.S. households and is projected to rise every year to be almost 45% of households by 2019. And that group has high homeownership rates: while the U.S. as a whole has about a 67% ownership rate, those 55 to 74 own homes at an 80% clip.

"Most buyers in this market are looking for an easy-living lifestyle. They would like easy access to services that will free up their time from maintenance both inside and outside their homes," said Mike McGowan, a 50+ builder from Binghamton, N.Y. and chairman of the National Association of Home Builder's 50+ Housing Council. "This data tells builders that the homes they build for older active adults will remain attractive to the consumers who will be entering that market for the foreseeable future."

1:24 PM EDT
September 8, 2010
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    Good article for the future of housing...

    Posted via email from Brian Gibbons REISkills.com's posterous