Summary:

Tax Credit extended to April 30th. This means you have to be IN a transaction before the end of April and CLOSE before the end of June.

• 1^st Time Home Buyers could be eligible for an $8000 tax credit.
• Upgraders could be eligible for up to a $6500 tax credit if you’ve owned your home for at least 3yrs.
• Some Portland Metro areas have experienced a 10% decrease in home values.
• Mortgage rates are at historic lows.

Now is a great time to buy!

Call or email me for more information 503-336-6736 / Ansbro@kw.com

For all those who have been contemplating buying a home or thinking that you need to sell and buy a new home this is the time.  The tax credit has been extended to include not only 1st time home buyers, it also includes those who currently own a home and want move.  Combine this tax credit with the facts that home market prices have declined and mortgage rates are still historically low and you have a recipe for profit taking opportunities.

Call me and let’s talk about what your real estate needs 503-336-6736.

Congress has passed new legislation that:

• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
• Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.

Who Qualifies for the Extended Credit?

• First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010.  To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.
• Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight.

Which Properties Are Eligible?

The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?

The maximum allowable credit for first-time home buyers is $8,000.

The maximum allowable credit for current homeowners is $6,500.

How is a Buyer’s Credit Amount Determined?

Each home buyer’s tax credit is determined by two additional factors:

1. The price of the home.
2. The buyer’s income.

Price

Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.

Buyer Income

Under the Extended Home Buyer Tax Credit, which is effective on November 7, 2009,  single buyers with incomes up to $125,000 and married couples with incomes up to $225,000—may receive the maximum tax credit.

These income limits have changed from the 2009 First-Time Home Buyer Tax Credit limits. If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see 2009 First-Time Home Buyer Tax Credit.

If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income—over $145,000 for singles and over $245,000 for couples are not eligible for the credit.

Can a Buyer Still Qualify If He/She Closes After April 30, 2010?

Under the Extended Home Buyer Tax Credit, as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.

Information provided by:

 http://www.realtor.org/home_buyers_and_sellers/2009_first_time_home_buyer_tax_credit   

Home Buyer  Average Search:

• Number of weeks searched: 10
• Number of homes seen: 10

First-Time vs. Repeat Buyers:

• First-time buyers: 41%
• Repeat buyers: 59%
• Median age of first-time buyers: 30
• Median age of repeat buyers: 47
• Buyers who definitely would use same agent again: 70%

Actions taken as result of Internet home search:

• Drove by/viewed a home: 77%
• Walked through a home viewed online: 63%
• Found agent used to search/buy home: 27%

Information sources used in home search:

• Internet: 87%
• Real estate agent: 85%
• Yard sign: 62%
• Open house: 48%
• Newspaper ad: 47%
• Home book or magazine: 30%

Source: 2008 National Association of REALTORS® Profile of Home Buyers and Sellers

Now is the time to find your home!  This is not a scare tactic.  This is an opportunity deadline notice.

Most people buying their first home know that the first time buyer tax credit will expire November 30th. What many people don’t know is what that means to them if they are in the market to buy a home.

Fact:  Average purchase transaction takes 30-45 days

Fact: The week before November 30th is Thanksgiving

Fact: November 30th is  the Monday following the three day bank shutdown

Important Timeline Information:

· Nov 25th, most banks closed early

· Nov 26th Thanksgiving

· Nov 27th Most banks closed

· Nov 30th Tax credit expires!

· Nov 20th  Recommended last day to close

Important Highlights

· Tax credit expires November 30th

· It takes 30-45 days to complete a home purchase

· Target your closing date as November 20th to give you some space

Putting Your Plan in Place

· Start house hunting NOW! If you look at the timeline, it should be clear that you should target having a property under contract  in the next few weeks to be able to close on time.

· Call me and let’s get out there hunting!

· Plan on closing by November 20th at the latest.

A Last Note

This information will help you avoid the rush and ensure that you can close prior to the expiration of the tax credit.

If you are not already pre-approved for a mortgage you should do so immediately.  I can point you in the direction of a good lender.

Call me at 503-336-6736 and I can work out a timeline that’s specific to your needs and goals.

Above all, don’t panic. There is still plenty of time to find the home of your dreams and take advantage of the tax credit.

You just need a plan to make sure you meet the deadline.  

Lots of people are looking for deals right now. I’ve had many people inquire about short sales and foreclosures.  Can you get a good deal with these types of sales…short answer is sometimes.  The caveat is that they are not for everyone, you will need to make sure you understand the differences between them and see if it is a road you are financially able to travel.

Here is a summary of what you can expect with those type of transactions.

1) Foreclosures – actual foreclosures are auctioned on the courthouse steps and you will need to pay cash for these.

• Bank Owned Foreclosures – these are foreclosures that did not sell on the courthouse steps and are placed back on the market by the bank.  You can purchase these using a loan.

2) Short Sales – these are houses where people have missed a couple of payments and are in financial jeopardy.  You can also use a loan to purchase these.  Not always a bargain but worth a go.

• Caveats include:
  i. Extended period to close the transaction. Between 3-6 months.
  ii. Banks are slow to respond with an answer as to whether your offer is accepted or not
  iii. Bank may entertain multiple offers at one time.  This means you may have a long wait before you know whether your offer was actually accepted AND a very short time to have the property inspected prior to close.

3) Standard Seller Listing – often times you can get a better deal by working through an agent to purchase a home that is not in one of the above distressed property types.  The seller may be motivated to sell for a number of reasons that don’t have to do with his/her financials, i.e. job move, marital status, etc.

Now you have a basic understanding of what to expect when you are looking for that special deal.  If you have any questions give me a call and I’d be glad you give you more indepth information.