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The New $8,000 First-time Home Buyer Tax Credit at a Glance
The New $6,500 Move-Up / Repeat Home Buyer Tax Credit at a Glance
Last night the Senate passed, by a vote of 98-0, extending the First Time Buyer $8.000 tax credit to 6/30/10 !!! Additionally, there is a provision in this bill that also extends a $6,500 tax credit to any home owner who trades up...having owned their existing residence for 5 years. The bill now moves on to the House. Recognizing the unanimous approval in the Senate it is believed that the House passage will take place quickly...perhaps as early as today! The White House expressed complete satisfaction and said the President will sign the legislation as soon as it hits his desk. This is great news for our business starting off the year.
Mike Muren, REALTOR
The Muren Team
Mackintosh Inc, REALTORS
Cell (301)524-4471 Office (800)727-7553
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If you're waiting for interest rates and prices of homes to drop further before you buy stop waiting and start getting serious now. According to the Wall Street Journal (9/24/09) "rates are going to be rising once the Government stops purchasing mortgage backed securities (the reason rates are where they currently are)." They intend on slowing these purchases until they completely cut them off in March 2010. Judging by the most recent 6 year trend those rates will be rising quickly and dramatically, and when these rates go up, 75% of the time they go up 2 percentage points higher than where they dropped from. So that means they could be going as high as 8.5%. So it would be in most peoples best interest to get things moving sooner than later when it comes down to purchasing a home, before you end up losing money on high interest rates.
Gavin Schaden, REALTOR
The Muren Team
Mackintosh Inc, REALTORS
Cell (301)514-0628 Office (800)727-7553
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Anyone brave enough to jump into today's free-falling housing market can take advantage of some serious incentives?
At the national level, home prices are off nearly 27 percent from their 2006 peaks, with certain markets--like Las Vegas and Miami--down more than 40 percent. That means most of today's buyers will be able to pick up properties at significant discounts compared with just a few years ago. Meanwhile, 30-year fixed mortgage rates are hovering at historically attractive levels of roughly 5 percent. But with the still-swooning housing market threatening to exacerbate an already-frightening recession, Uncle Sam recently tossed an additional incentive into the mix. To stimulate demand, President Barack Obama's $787 billion economic stimulus plan--which was signed into law in mid February--included a tax credit of up to $8,000 for first time-home buyers. Here are seven things you need to know about this new tax credit:
1. The specs: The tax credit is equivalent to 10 percent of the purchase price of the home--which must be a principal residence--but is capped at $8,000. It applies only to first-time home buyers, who are defined as buyers that haven't owned principal residences for three years before making the purchase. The tax credit, however, is subject to income limitations. A single buyer would need an adjusted gross income of $75,000 or less to be eligible for the full credit (For married couples it's $150,000.) Those who make more may qualify for partial credits.
2. 2009 buyers: The credit only applies to those who buy a home on or after Jan. 1 and before Dec. 1, 2009. That means anyone who bought a home last year is out of luck. But Richard Moody, the chief economist at Mission Residential, says a more significant shortcoming of the tax credit is that it won't help 2010 buyers. Moody argues that the biggest factor keeping people from buying homes these days is the weakening labor market. In other words, as long as Americans are worried they could lose their jobs they won't buy homes, he says. "I don't expect to see any appreciable improvement in the labor market until sometime next year at the earliest," he says. "[As a result], I think this [tax credit] is going to expire before a lot of people feel confident to go out and make this purchase."
3. $15,000 letdown: The tax credit is much smaller than a similar $15,000 measure that was included in the Senate's version of the stimulus bill. The $15,000 tax credit was scrapped during negotiations between the House of Representatives and the Senate. "We would have liked to have seen [a bigger tax credit]," says Tom Kunz, the president and CEO of Century 21 Real Estate. "But $8,000 is still $8,000."
4. No payback: The good news for prospective homebuyers is that unlike a previously-enacted $7,500 tax credit, this one doesn't have to be repaid. That makes the credit much more attractive from a would-be buyer's prospective, says Keith Gumbinger of HSH Associates. "[It's a] more traditional sort of incentive," he says.
5. One of many: With home prices declining and job losses rising, the tax credit is just one of many factors to consider when deciding whether or not to buy a home, says Mike Larson of Weiss Research. "It should factor into your decision, but it shouldn't drive your decision," he says. The trend of property values in a local market, the buyer's job security, and the number of years the buyer plans on living in the house are more important. "This [tax credit] can help, but those are the real things that are going to be a fundamental driver," Larson says.
6. Market impact: Gumbinger expects the measure to have only a modest impact on the housing market. That's because it can't do anything to address the weakening labor market, falling consumer confidence, or tightening lending standards that are working to prevent many would-be buyers from entering the market. "It certainly helps to serve an audience which can [already] participate in the market," Gumbinger says. "But it doesn't do anything to help to develop demand from those borrowers who are at the fringes--or far away from the fringes--of participating."
7. Part of a bigger effort: Nicolas Retsinas, the director of Harvard University's Joint Center for Housing Studies, says the tax credit should be perceived as one component of a broader effort to revive the housing market and the economy. The economic stimulus package is designed to bolster the labor market, and the Obama administration's new housing plan will attempt to limit foreclosures. "If those two make a difference, then this could be an added stimulus," Retsinas says. "But again, it's tough to buck the erosion of jobs and the foreclosure market."
What should you do.
With the hope that the $8000 tax credit will be extended now is the time to call The Muren Team and start looking for a home. We can introduce you to many homes in your location of choice and price range. We will take the time to get you qualified with a competitive lender, discuss available grants and walk with you through the entire experience.
Buying a Foreclosed home is a great way to go as long as you have an experienced Realtordirecting you with knowledge of the system is process. A Realtor from The Muren Team with Mackintosh Inc. Realtors can show you every available home for sale, set up home inspections with qualified inspectors that know what to look for so that you do not end up in a situation of a lot of repairs. A title search is extremely important and we only work with the best to assure you your title is clear of defects and liens. What are you waiting for?
There has never been a better time to buy a home. Prices are still low and the interest rates are almost certainly going to go up. Tall today to get more information and make the dream of home ownership a reality.
Allie Ballew, REALTOR
The Muren Team
Mackintosh Inc, REALTORS
Cell (301)676-2844 Office (800)727-7553
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1. Get Basic Real Estate Knowledge. Many great agents are sponges trying to get as much education as they could as quickly as they could. Consumers want a well educated professional to guide them.
2. Know You Can Make Money. Though many great agents never stop learning, they also realize that they must apply what they learned. You can't learn to swim in a classroom. You need to get in the pool. You have to take action and make sure you don't just get ready to get ready.
3. Integrity is a must. Real estate is a business based of of referrals and referrals are based of of trust. Your clients must truly feel like your on their team if your going to win the business of their friends and family.
4. Develop a Great Attitude. Success is impossible without failure. Most great agents are never concerned about lack of success. They had faith that if they continued to do the right things, success was in their future.
5. Write a Great Business plan. Many agents do not hit the ground running and lose momentum. This is often in part to the fact they do not have a solid business plan with clearly identified goals, time farms and budgets.
6. Advanced Real Estate Knowledge. Once many became comfortable that they could list and sell property, they dove into advanced training to better counsel their clients. They became specialists in certain types of real estate and became the regional expert.
7. Treat Your Profession as a Business. Most good agents not only searched out real estate education but also thursted to learn more about running their own businesses (business planning, team building, etc.).
Mike Muren, REALTOR
The Muren Team
Mackintosh Inc, REALTORS
Cell (301)524-4471 Office (800)727-7553
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Every year around this time Mackintosh Realtors visits a near by school that teaches students with special needs. The Muren Team decided this year more that most would be a time to give back , show some kindness to a community that has shown us the same. For a brief while I forgot about foreclosures and short sales. My thoughts were not with appraisals and home inspections or how the DOW and the treasury bonds would affect interest rates or even what the gold market was doing or what I would pay at the pump.
Instead I was totally blown away by the teachers and staff at this school. How much care and devotion they extended to their students. The absolute joy they received from the smiles on the children's faces from something as simple as a pumpkin given to them from someone like me in a funny costume. We are in hard times and these are the times that will define who we really are. So today -open the door for someone, smile at a stranger, call an old friend that may need to hear a caring voice...count your blessings. As for me I am going to call my son and tell him I love him and thank him for being who he is.
What are you going to do?
Allie Ballew, Realtor
The Muren Team
Mackintosh Inc. REALTORS
Cell (301)676-2844 Office (800)727-7653
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The Mike Muren Team out of Frederick, MD has sold a home every 7 days for the past 6 years. We take pride in producing the result's you need in todays market. For Mor info go to www.TheMurenTeam.com
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