May 19, 2020

Tips for Mastering 'Price, Value and Cost' and Buying Your Dream Home

Real estate
money matters
Dottie Herman
Home buying
Bizclik Editor
3 min
Tips for Mastering 'Price, Value and Cost' and Buying Your Dream Home

Written by Megan Gates

Knowledge is power. Becoming an educated buyer gives you the advantage when you are in the process of negotiating for your dream home.
 
Recently, on “Eye on Real Estate with Dottie Herman,” Dottie Herman, the CEO and President of Prudential Douglas Elliman, discussed three crucial elements used to determine the worth of a home. In her broadcast, “The Art of Negotiations,” Dottie explained how PVC–price, value and cost–comprise the worth of a home and determine the right price for you.
 
First, search for a broker that suits you, your preferences and understands the real estate market in your area. Some aspects used to determine a property’s worth are the same for every real estate transaction. Some aspects depend on your personal preferences. Combining your broker’s knowledge with your preferences determines the worth of a property as it pertains to your purchase. Knowing what the home is “worth” to you, puts you in command when negotiating the final price.
 
Price
 
How do you know if the asking price is correct?
 
“Price is what the home should be worth today. But sometimes people don’t price it right, so what you really want to look at is fair market value,” Herman answered.
 
Fair market value is determined by comparing the price of similar properties in your target area. A real estate broker provides this information through a Brokers Price Opinion (BPO) or a Comparative Market Analysis (CMA). Herman urged potential homebuyers to “eyeball” properties for information that is not contained in either the BPO or CMA like:
 
Wear and tear on the property
Neighbors
View
Location
 
If a home with a view is your non-negotiable, then you may think the price is “fair” even though the price may be above others on the BPO or CMA. Conversely, if a home requires extensive repairs or is next to a dilapidated property, then the price in a BPO or CMA may not be so fair. Knowledge gained when determining fair market value is a powerful advantage when negotiating.
 
Value
 
The value of a home is as Herman states, “An opinion of what you think the home is worth, based on how you are going to use it.”
 
Each property will have features highly valued to some but not others. For example, homeowners are advised that remodeling a kitchen or bathroom add “value” to a home. However, if a potential buyer is looking for a home in a prestigious school district, then that kitchen or bathroom remodel will have little value to them if the home is outside the school boundaries.
 
Cost
 
Herman stated that sellers believe that the cost of the house is what they paid for plus all of the improvements and money that they put into it thereafter. She went on to say that, “Cost is a measure of the past.”
 
Because different factors are intertwined and influence price, value and cost, the worth of a home is an estimate, and as Herman states, “There is no exact science to pricing.”

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Jun 8, 2021

Six issues at the top of tax and finance leaders’ agenda

Tax
Compliance
financeleaders
Deloitte
Kate Birch
4 min
As businesses accelerate their transformation journeys, tax leaders are under increasing pressure to add strategic value. Deloitte reveals six tax trends

New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.

According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.

And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.

Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.

Trend 1: Businesses seek more strategic counsel from tax

Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.

According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”

Trend 2: Tipping point for resourcing models

Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.

Trend 3: Digital tax administration is moving faster than expected

in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.

"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."

Trend 4: Data simplification and lower-cost resourcing are top priorities

Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.

At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”

Trend 5: Skillsets are shifting

Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.

Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact 

Trend 6: 2020 brought productivity improvements

Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.

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