Tag Archive for 'buying home'

Spring Offers Hope But Will it Last?

Published
by
kmunsell
on March 26, 2009
in Home Buying, Home Selling and Market Conditions
. 104 Comments

The official start of spring pounced on the scene just days ago. From the winter trodden areas of the country, bulbs peer out from under ground, cherry trees poise to burst, and tiny, new leaves prepare to invade winter beaten branches.

Spring, the traditional start of prime real estate season, is here. This year, however, is an extraordinary year.  Will the traditional spring real estate jolt happen this year? If you sell, will they come?

Have faith. The lookers are already beginning to emerge from their quiet, hiding places, waiting to blossom into healthy, thriving buyers. So far:

  • New home starts jumped 22% in February, compared to one month prior. Though this number is still significantly below where it was one year ago, it does offer some hope.
  • Sales of existing homes rose 5.1% from January figures, again still lower than same time last year, but a move in the right direction, nonetheless. 
  • New home buyers can obtain up to $8,000 in tax credit from a qualified purchase.
  • Fixed rate mortgages are as low as 4 3/4% for qualified buyers.

This year, spring is needed more than any year before, but we don’t know how long this new burst of life will last. Is the market now poised for a turnaround or is it just a spot of sunshine that will shrink in the dark clouds ahead. Nobody knows what lies ahead, but if a move in on your mind, there may be no better time. 

Sellers clean up, price well, and play nice to make a sale, and lookers, buy now or prepare to stick it out for the long haul. Right now, the time is right for both sides of the deal. Let’s just hope this lasts.

Readers, share your thoughts below. Do you believe we’ve reached the bottom and clearer skies lie ahead, or do you believe this is a short term, transient burst of energy?

What You Need to Know about the $15,000 Tax Credit

Published
by
kmunsell
on February 11, 2009
in Home Buying and Market Conditions
. 114 Comments

Good news may be on the way for the lackluster real estate market. Last week, the Senate added a $15,000 home buyer tax credit to the economic stimulus package with the goal of kick starting the nation’s real estate market.

Previous attempts by Congress to bolster the tumbling market failed to elicit any real activity in home sales. Maybe it’s because the $7,500 tax credit wasn’t substantial enough. Maybe it’s because it was only applicable to the sale of a new homes, or maybe it’s simply because it wasn’t really a tax credit, but an interest free loan. Whatever the reason, it just wasn’t enough to kick start anything.  

However this time around, Congress might be more on mark. As part of the economic stimulus package currently making its way through Congress.Legislators propose up to a $15,000 tax credit for those who purchase any primary residence.  

While the economic stimulus package may be approved as early as this week, there are some important points about the proposed tax credit that prospective homeowners should know:

  • This actually is a tax credit – no repayment is required.
  • The actual amount of the tax credit would be either $15,000 or 10% of the subject home’s value, whichever is less. Therefore to be eligible for the full amount, the property must be $150,000 or more.
  • The credit will be given as a $7,500 tax credit over a two year period. Therefore, you must occupy the property as your primary residence for at least two years to receive the entire benefit. The credit applies to any purchase of a primary home, including single family homes and condos, regardless  of whether or not the home is new, a resale, or a foreclosure.
  • There are no income restrictions to receive the credit, but to receive the full benefit, you must earn enough to owe $7,500 in income taxes in one year. 
  • If you purchased a home under the $7,500 tax credit, the new $15,000 tax credit will not apply to you.
  • If the new $15,000 tax credit is passed, the previous $7,500 tax credit will no longer apply to any new home purchases from the date of enactment forward.

Let’s hope that Congress will move quickly, or waiting too long could have the opposite effect. With a tax credit looming in the air, potential homebuyers will likely sit back and wait until the legislative haggling is done and the credit can be secured.