sale to relatives

What is the name of your state? California.

My husband and I will be purchasing a condominium residence from his mother. The home qualifies as her primary residence under tax law so she will have no capital gains taxes. She is selling to us for a discounted price of about 15% below current market value. (Thanks, Mom!) We are concerned that when the sale is recorded, market values will be negatively influenced by our low "family" sales price. Is this the case or is a sale between family members viewed as a special circumstance sale? Or - is there another way to record the sale (such as a transfer) so as not to affect the market while still preserving Mom's tax relief? Thank you.

[HomeGuru]

[quote]Originally posted by goombah92
[b]What is the name of your state? California.

My husband and I will be purchasing a condominium residence from his mother. The home qualifies as her primary residence under tax law so she will have no capital gains taxes. She is selling to us for a discounted price of about 15% below current market value. (Thanks, Mom!) We are concerned that when the sale is recorded, market values will be negatively influenced by our low "family" sales price. Is this the case or is a sale between family members viewed as a special circumstance sale? Or - is there another way to record the sale (such as a transfer) so as not to affect the market while still preserving Mom's tax relief? Thank you.

**A: don't worry about damaging the market values, as your sale will not be an effective comp for appraisal purposes. Due to a sale between relatives and the discounted purchase price, your transaction will not be considered as an "arms length" transaction.
I am not sure why you are worrying about this issue at all. In any case, once the sale is recorded and appraisers call you for comp info, you could provide the details such as market value less 15% due to relatives. One sale would not control the real estate condo market in your area.
Lastly, lest I forgot; thanks Mom.