The U.S. House of Representatives
passed a bill extending and ex-
panding the Federal Tax Credit for
First-time Home Buyers on Novem-
ber 5th. The bill was passed in the
U.S. Senate the day before and will
now go to President Obama for his
signature, where it is expected to
be signed this week.
The tax credit will be extended
through April 30, 2010, with a 60-
day extension if a binding contract
is in place prior to the deadline.
First-time home buyers will continue
to receive a tax credit of up to
$8,000, while existing homeowners
will receive a reduced credit of up
to $6,500. Existing homeowners will
be eligible for the $6,500 if they
have lived in their current resi-
dences for at least five years. The
bill also will increase the qualifying
income limits from $75,000 for sin-
gle tax filers and $150,000 for joint
filers, to $125,000 and $225,000,
respectively. The purchase price of
the home is capped at $800,000.
The changes, among other things,
are aimed at encouraging so-called
“move-up buyers” to sell their first
homes and buy a larger or more
expensive place.
Under additional provisions in the
bill, taxpayers can claim the credit
on purchases completed in 2010 on
their 2009 income tax returns. The
bill maintains the provision that
home buyers do not have to repay
the credit provided the home re-
mains their primary residence for 36
months after purchase, and waives
this requirement for active duty
military personnel who move due to
a military order. “The success of the home buyer tax
credit and its positive impact on the
real estate market is clear,” said
C.A.R. President James Liptak.
“According to our research, nearly
40 percent of first-time buyers said
they would not have purchased a
home if the federal tax credit for
first-time home buyers was not
offered. This underscores the sig-
nificance of the federal tax credit to
the housing market’s recovery in
California.
Inventory of single-family, re-sale homes fell for the thirteenth month in a row in August, and it is now down 43.1% year-over-year. Pending sales, meanwhile, climbed 31.3% from July, and were up 100.5% compared to August 2008. The median price for singlefamily, re-sale homes lost 7.5% in August. Year-overyear, the median price was off 13.4% Sales of single-family, re-sale homes were up, year-over-year, by 3.2% in August. Year-to-date, home sales are up 16.6%. Days of Inventory rose seven days to 129 days. In a balanced market, the supply of homes is usually around five to six months. For condos, the indicator dropped ten days to 176 days. The sales price to list price ratio rose 1.2 points to 98.5%. Condo sales rose 3.6% month-overmonth, but were off 9.4% compared to last August. Year-to-date, condo sales are up 9.5%. The median price for condos fell 28.1% from the month before, and was down 26.9% compared to last August. www.soldonsantacruz.com
Santa Cruz County Home Prices Continued to Rise in May
re-sale homes rose 4.7% from April.
The median price was off 23.9%
year-over-year. The average
price fell 9% month-overmonth,
and was down
30.2% compared to last
May.
Sales of single-family, resale
homes were up, yearover-
year, by 10.3% in May.
Year-to-date, home sales
are up 21%.
Inventory was down 39.8% from
last May. This is the thirteenth
month in a row inventory has declined
year-over-year.
The drop in inventory and the rise
in sales combined to push our Days
of Inventory indicator down 21 days
to 156 days. In a balanced market,
the supply of homes is usually
around five to six months. For condos,
the indicator rose thirteen days
to 172 days.
The sales price to list price ratio
rose 0.8 of a point to 98%.
Pending sales, a leading indicator,
were up 35.1% year-over-year.
Condo sales were up 3.4% yearover-
year. Year-to-date, condo
sales are up 28.3%.
The median price for condos
rose 17.5% from the month
before, but was down 9.2%
compared to last May.
Condo inventory was down
34.4% compared to March
2008.
Pending sales for condos is
up 25% year-over-year.
The real estate market is very hard
to generalize. It is a market made
up of many micro markets. For
complete information on a particular
neighborhood or property, call me.
The Basics: 2009 First-Time Home Buyer Tax Credit
U.S. housing market and address
the economic challenges facing our
nation, Congress has passed legislation
that grants a tax credit of up
to $8,000 to first-time home buyers.
WHO QUALIFIES?
First-time home buyers who purchase
homes between January 1,
2009 and December 1, 2009.
To qualify as a Gfirst-time home
buyerH the purchaser or his/her
spouse may not have owned a
residence during the three years
prior to the purchase.
WHICH PROPERTIES ARE ELIGIBLE?
The 2009 First-Time Home Buyer
Tax Credit may be applied to primary
residences, including: singlefamily
homes, condos, townhomes,
and co-ops.
HOW MUCH WILL THE CREDIT BE?
The maximum allowable credit for
home buyers is $8,000. Each home
buyerIs tax credit is determined by
two factors:
The price of the homeJthe credit is
equal to 10% of the purchase price
of the home, up to $8,000.
The buyer's incomeJsingle buyers
with incomes up to $75,000 and
married couples with incomes up to
$150,000Jmay receive the maximum
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 $75,000 and
$95,000 for single buyers and between
$150,000 and $170,000 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
incomeJover $95,000 for singles
and over $170,000 for couples
are not eligible for the credit.
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 the three-year period,
the credit will be recouped on the
sale.
TAX CREDIT CAN BE USED ON CLOSING
COSTS
FHA-approved lenders received the
go-ahead to develop bridge-loan
products that enable first-time buyers
to use the benefits of the federal
tax credit upfront, according to
eagerly awaited guidance from the
U.S. Department of Housing and
Urban Development on so-called
home buyer tax credit loans that
was released today.
Under the guidance, FHA-approved
lenders can develop bridge loans
that home buyers can use to help
cover their closing costs, buy down
their interest rate, or put down more
than the minimum 3.5 percent.
The loans can't be used to cover
the minimum 3.5 percent, senior
HUD officials told reporters on a
conference call Friday morning.
Second generation Santa Cruz County Real Estate agent, and certified EcoBroker, and e-Pro. Local Knowledge, Local Living.
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