NEWS FLASH!! Homebuyer Tax Credit has been extended for 1st Time Buyers and expanded to include Current Homeowners who want to move!
Did you hear today’s news that government has passed an extension to the 1st Time Home Buyers Tax Credit AND have added another credit for current homeowners.
Here are some details that are the same for both segments of the bill:
- Both segments of the bill will be for transactions that go into contract between the date that Obama signs (Nov 6) thru Apr 30, 2010. The transactions must close prior to Jul 1, 2010.
- Income limits have been increased to $125,000 for singles, $225,000 for married couples.
- Limit on the price of the home is $800,000.
- Purchaser must attach documentation of purchase to their tax return.
Details for 1st Time Buyers
- Can receive up to $8,000 ($4,000 married, filing separate)
- Cannot have owned a home (principal residence) for the past 3 years
Details for Current Homeowners – NEW!
- Can receive up to $6,500 ($3,250 married, filing separate)
- Must have used their current home as principal residence consecutively for 5 of the previous 8 years.
- The new home you buy doesn’t have to be more expensive than the home you’re selling. In other words, you can downsize if you want.
While many 1st Time Buyers took advantage of the tax credit this past year, there was nothing to help the move-up market because those 1st Timers often bought REO, short-sale or foreclosed homes. The National Association of Realtors® and numerous real estate bloggers begged and pleaded for help with homes in the upper prices since they were often just sitting on the market.
This new program will benefit higher-priced buyers as well as help sell homes in the higher price ranges.
If you’re a higher-priced buyer, should you act now? Naturally, only you can decide that, but here are some things to consider:
- Interest rates have been hovering around 5%. Bernanke is watching for signs of inflation. If inflation begins to creep up, interest rates may be allowed to increase to stem inflation. They know that this could slow real estate’s recovery, and they really need the real estate market to improve, so it will be a tough decision.
- If this new bill works as we hope it will, increased demand may actually cause prices to rise somewhat.
- If you were thinking of putting your home on the market next year, you may want to move up your timing to take advantage of these tax credits both for you and for the appeal to your buyers.
- Also, if buyers act on this program by April, that may mean that demand will be lessened (exhausted) by the end of April. If demand decreases afterward, so will your potential price.
A 1-point interest rate increase will cost you far more than waiting for prices to decrease further
For instance in the example below, a $200,000 price with 3.5% down at a current interest rate of 5%, would result in a mortgage payment (P&I) of $1,036. At 6% interest, the payment would be $1,158. Over 30 yrs, that will cost you an additional $43,772. Even if the price comes down $10,000 to $190,000 but the rate increases to 6%, your monthly payment would be $1,100, costing you an additional $22,928. If the price increases just 5% and the interest goes to 6%, then you would pay an extra $179 per month.
| Home Price |
$200,000 |
| Price Chg |
-5% |
No Chg |
+5% |
| New Price |
$190,000 |
$200,000 |
$210,000 |
| 3.5% Dwn Pmt |
$6,650 |
$7,000 |
$7,350 |
| Mtg Amt |
$183,350 |
$193,000 |
$202,650 |
| P&I at 5% Int |
$984.59 |
$1,036.41 |
$1,088.23 |
| P&I at 6% Int |
$1,100.10 |
$1,158.00 |
$1,215.90 |
Naturally the higher priced the home, the greater the savings. Notice that the money coming from Uncle Sam hasn’t even been included in the above data. Interested or want more info? Give me a call and we’ll get your home on the market.
View comparison chart to the 2009 Tax Credit
Read FAQ’s for New Tax Credit
Copyright © 2009. Elaine Reese, Real Living HER. Reproduction of any portion of this blog post or the images is prohibited by the Digital Millennium Copyright Act. If this post is being viewed on any site other than www.ReesesPiecesOfRealEstate.com then the material has been stolen without permission. Violators will be reported.
Ana winds prevail, although I’m not sure. I do know that when we rounded a curve on the freeway east of LA, we saw mile after mile of probably hundreds of tall turbines. Some were turning while others were stopped. I learned later that whether they rotate or not, depends upon the demand for electricity.
Elaine Reese
614-825-8860Real Living HER
Mailbox litter – how do we stop it?
11/20/2009 · Leave a Comment
I personally don’t care for these flyers as they make the neighborhood look messy, especially when they blow away into our yards and streets. Similar to these flyers are the “free” newspapers that are thrown in our drives.
As a Realtor®, this “litter” creates real problems when the home being sold is vacant. To keep the home looking presentable – and NOT look vacant – I do frequent drive-bys to remove the papers and flyers. I know the days the newspapers are delivered, so I time my schedule to do the pick-ups then. The other business flyers are random, so they are harder to monitor.
In my previous career, I traveled frequently. I would make arrangements with the P.O. to hold my mail while I was gone. There was nothing I could do to stop the incessant flyers other than ask my poor neighbors to toss the junk around my mailbox when they saw it. There was one real estate agent who habitually left flyers, so I called her to explain my situation and asked her to please not leave the flyers at my address. Apparently my multiple requests to her fell on deaf ears, as it didn’t stop. When it came time for me to sell that home, guess which Realtor® I DID NOT call.
With the issues we have today of thieves entering vacant homes to steal copper, these flyers have become even more of a concern because they are a bold advertisement of an empty, unoccupied home.
I would like to make a plea to to the businesses using this form of advertising and to the newspaper delivery folks. If you see a “For Sale” sign in the yard, please don’t tack your flyer to the mailbox or throw your paper in the drive. You might just be contributing to a burglary.
Copyright © 2009. Elaine Reese, Real Living HER. Reproduction of any portion of this blog post or the images is prohibited by the Digital Millennium Copyright Act. If this post is being viewed on any site other than www.ReesesPiecesOfRealEstate.com then the material has been stolen without permission. Violators will be reported.
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