Homebuyer Tax Credit Update!
On November 6, 2009, President Obama signed a bill to extend the tax credit for first-time homebuyers (FTHBs) through June 30, 2010. The bill also opens up opportunities for others who are not buying a home for the first time.
Tax Credit for Homebuyers
First-Time Homebuyers (FTHBs): First-time homebuyers (that is, people who have not owned a home within the last three years) may be eligible for the tax credit. The credit for FTHBs is 10% of the purchase price of the home, with a maximum available credit of $8,000.
Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.
Current Owners: The tax credit program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years.
Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.
What are the New Deadlines?
In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.
Tax Credit Versus Tax Deduction
It's important to remember that the tax credit is just that... a tax credit. The benefit of a tax credit is that it's a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a first-time homebuyer were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.
Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!
Higher Income Caps
The amount of income someone can earn and qualify for the full amount of the credit has been increased.
Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible
Joint filers who earn up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.
Maximum Purchase Price
Qualifying buyers may purchase a property with a maximum sale price of $800,000.
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Remember, the new tax credit program includes a number of details and qualifications. For more information or answers to specific questions, please call or email me today.
In addition, you may be able to benefit from additional housing related provisions, including the following:
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Tax Incentives to Spur Energy Savings and Green Jobs
This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.
Landmark Energy Savings
This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.
Repairing Public Housing and Making Key Energy Efficiency Retrofits To HUD-Assisted Housing
This provision provides a total of $6.3 Billion for increasing energy efficiency in federally supported housing programs. Specifically, it establishes a new program to upgrade HUD-sponsored low-income housing (for elderly, disabled, and Section 8) to increase energy efficiency, including new insulation, windows, and frames.
Expanding Housing Assistance
This provision increases support for several critical housing programs. It includes $2 Billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties.
Do you think this is a good thing for the economy and housing? I would love to hear your opinion.
Property Assessments in a Declining Market
Questions like these are being asked by homeowners nationwide as we struggle to make sense of the current economic climate. In each case, the property owner is concerned about the value of their assessment. These FAQs were developed to assist residential property owners in understanding how real estate trends affect their assessment and how the assessed value relates to the property tax bill.
In Wisconsin, we've been fortunate that our property values are weathering the market relativity well compared to many other areas of the country. While the news media portrays values as dropping, it speaks to an overall trend in some areas and doesn't take into account a specific neighborhood or specific properties. In actuality, some communities, and some neighborhoods, have seen values increase; many neighborhoods are experiencing fewer sales yet values remain relatively stable; and a few neighborhoods have experienced foreclosures and short sales that have driven market values lower. It's the latter neighborhoods that capture news media attention.
If your municipality happens to be conducting a revaluation this year, then your assessment will reflect the most probable market value. A revaluation sets all properties at market value as of January 1 and establishes the relationships of one property to another. Those relationships remain until the next revaluation. If your community is not conducting a revaluation this year, then your assessment will likely not be adjusted if the only change occurring is the same market adjustment that the rest of the community is experiencing. Just as your assessment didn't go up each year when property values where rapidly increasing, your assessment will not be adjusted downward just because values are declining. The reason for this is twofold. If all values are going up or all values are going down, it doesn't change the relationship of one property to another and therefore doesn't change the tax burden relationships.
Secondly, in order to contain costs, most municipalities do not perform a revaluation every year. It is the revaluation process that adjusts everybody's value to reflect those properties which have sold.
Not necessarily. To illustrate how the levy affects your assessment we'll look at Badgertown; a community of two. Each resident owns a house valued at $100,000. Badgertown's tax levy is $2,000; the amount needed to cover its expenses. Since each resident owns 50% of the total property, they each pay 50% of the levy giving them each a tax bill of $1,000.
If property values in Badgertown go up 10%, then each property is assessed at $110,000. The amount they pay in taxes, however, remains the same. Each resident still owns 50% of the total property in Badgertown and must pay 50% of the $2,000 tax levy or $1,000. And what if values start dropping? Residents' property might drop to $80,000 each but because they each still own 50% of the property, and Badgertown still needs to collect $2,000, they will continue to see a $1,000 property tax bill.
Usually not. Foreclosed properties are being marketed under duress and frequently sell at discount prices. While there have been more foreclosure-related sales during 2008 and 2009 than any time during the past 20 years, foreclosure sales have always been part of the market. In this downturn, Wisconsin has fared better than most states as real estate values adjust to the economic climate. Just as foreclosure-related sales are frequently not an indicator of market value when values are rising, they are not necessarily an indicator of value in a declining market and are not normally considered by the assessor when determining the market value of property in a community. In fact, Wisconsin law, appraisal standards, and Wisconsin courts, require very specific criteria for a sale to be considered as a reliable indicator of market value. Two of the most important of these criteria are whether the sale occurred under duress (such as a forced sale) and whether the property had adequate market exposure. For example, a property that sells two weeks after it's listed may have sold quickly because it was under-priced. This may be an indication of a duress situation, requiring closer review by the assessor, to verify whether is was an arms length transaction. In most cases, looking at non-foreclosure sales is the most reliable way to gauge what is actually happening with neighborhood values.
There are times when the majority of homes that are selling in your neighborhood tend to be around the same price as foreclosure-related sales. In this case, they may represent a reasonable picture of market value
Property owners know their assessment is used to calculate their December tax bill. What many taxpayers find confusing is that the assessment is only one part of the equation for computing the property tax. The other variable used to compute property taxes is the tax levy.
The levy represents the budgets established by the municipality, schools, etc. to cover their expenses. Those expenses are apportioned among property owners according to the percentage of ownership they have in the total property of the municipality. Thus, the actual tax bill is dependant on both the amount of all the taxing jurisdiction levies and the proportion of your assessment to the total value of property in the community. If you own 1% of the property value in your community, then you will pay 1% of the tax levy. It is the proportion of your assessment to the total value of the community that affects your tax bill, not the assessment number itself.
Said another way, your municipality must collect a certain amount; no more, no less. It divides that amount among all owners in proportion to the amount of property they own. Whether the property in the municipality is assessed at 90% of market value or 110% of its market value has no effect on your particular tax bill so long as your neighbors are also being assessed at that same 90% or 110%. This is the concept of uniformity and the basis for Wisconsin tax law.
An increase or decrease in the assessment of an individual property does not predict whether the tax bill for that property will go up, down, or remain the same.
Additional information is available at the following websites: Wisconsin Department of Revenue's Guide for Property Owners
www.revenue.wi.gov/html/govpub.html#property and Wisconsin Association of Assessing Officers www.WAAO.org
FOR MORE INFORMATION PLEASE CONTACT:
WISCONSIN DEPARTMENT OF REVENUE
Division of State & Local Finance
Bureau of Assessment Practices
P.O. Box 8971, MS 6-97
Madison, WI 53708-8971
Phone: (608) 266-7750 (608) 266-7750
Fax: (608) 267-0835
E-Mail Additional Questions
Many of you ask us "What is going on in my local housing market?"
We will continue to update this on a monthly basis so bookmark this page and visit often...
...or sign up for a monthly email report that is specific to your neighborhood!
See blog post http://mywisconsinrealestateblog.com/post/1218462/pricing-your-home-in-todays-market
Below you will find sales data for Waukesha, Jefferson and Dane Counties.
These sales are single family homes only. If you would like to see postings on Condos, land or any other county let us know.
Compare 2008 vs 2009 notice the Days On Market as well as the average sale price difference.
This is a good time to buy your first home or move up in size. If you are curious on the value of your home visit
| This Search Waukesha county under $400,000 2009 | Original Price | List Price | Sales Price | CDOM | Price Chg | % Price Chg |
| This Search (223 Matches) | ||||||
| Average | $247,311 | $239,425 | $229,878 | 119 | $-15,844 | -6% |
| Median | $234,900 | $224,900 | $218,000 | 78 | $-12,100 | -5.01% |
| Low | $111,900 | $69,900 | $69,900 | 1 | $-110,000 | -44.48% |
| High | $499,900 | $399,900 | $385,000 | 769 | $100,000 | 37.74% |
| 223 w/Orig. Pr. | 223 | 223 sold | 223 | 111 changed price |
Of these 21 sales were in Brookfield, 3 in Delafield, 5 in Hartland, 22 in Menomonee Falls, 9 in Mukwonago,9 in Muskego, 33 in New Berlin, 20 in Oconomowoc, 9 in pewaukee, 9 in Sussex, 52 in Waukesha. Other areas were 31.
Click to view listings (may take a mintue to load, report only good 30 days.)
| This Search Waukesha county over $400,000 2009 | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search (37 Matches) | ||||||
| Average | $668,504 | $632,177 | $582,619 | 219 | $-56,004 | -8.26% |
| Median | $549,765 | $499,900 | $460,000 | 143 | $-30,050 | -6.69% |
| Low | $419,000 | $414,000 | $386,000 | 7 | $-176,000 | -18.49% |
| High | $1,575,000 | $1,575,000 | $1,520,000 | 885 | $-10,000 | -2.22% |
| 37 w/Orig. Pr. | 37 | 37 sold | 37 | 24 changed price |
Of these 2 sales were in Brookfield,3 in Elm Grove, 5 in Delafield, 2 in Hartland, 1 in Menomonee Falls, 4 in Merton, 2 in Mukwonago,3 in Muskego, 1 in New Berlin, 3 in Oconomowoc, 5 in pewaukee, 1 in Waukesha.
Click to view listings (report only active for 30 days)
| This Search Waukesha county under $400,000 October 2008 | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search (206 Matches) | ||||||
| Average | $265,918 | $257,892 | $246,628 | 112 | $-19,919 | -7.24% |
| Median | $259,900 | $249,900 | $240,000 | 76 | $-15,000 | -4.98% |
| Low | $74,900 | $40,000 | $32,000 | 1 | $-90,000 | -46.6% |
| High | $489,900 | $400,000 | $399,900 | 579 | $9,000 | 6% |
| Number of listings | 206 w/Orig. Pr. | 206 | 206 sold | 206 | 83 changed price |
Of these 18 sales were in Brookfield, 3 in Elm Grove, 6 in Delafield, 6 in Hartland, 22 in Menomonee Falls, 6 in Mukwonago, 8 in Muskego, 21 in New Berlin, 23 in Oconomowoc, 15 in pewaukee, 3 in Sussex, 50 in Waukesha.
| This Search Waukesha county over $400,000 October 2008 | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search (41 Matches) | ||||||
| Average | $649,493 | $628,612 | $588,298 | 155 | $-40,767 | -5.69% |
| Median | $519,900 | $514,900 | $500,000 | 81 | $-25,000 | -4.35% |
| Low | $400,000 | $400,000 | $315,000 | 6 | $-185,000 | -16.67% |
| High | $1,935,000 | $1,799,000 | $1,620,000 | 545 | $25,000 | 5.56% |
| Number of listings | 41 w/Orig. Pr. | 41 | 41 sold | 41 | 21 changed price |
Of these 5 sales were in Brookfield,1 in Elm Grove, 2 in Delafield, 4 in Hartland, 2 in Menomonee Falls, 2in Merton, 1 in Mukwonago,3 in Muskego, 4 in New Berlin, 4 in Oconomowoc, 6 in pewaukee, 1 in Waukesha.
| This Search Jefferson County October 2009 | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search (52 Matches) | ||||||
| Average | $208,223 | $199,568 | $187,325 | 133 | $-18,002 | -8.1% |
| Median | $176,450 | $176,450 | $171,450 | 95 | $-10,850 | -6.67% |
| Low | $35,000 | $35,000 | $42,500 | 1 | $-89,100 | -18.93% |
| High | $995,000 | $995,000 | $750,000 | 756 | $-3,000 | -2.46% |
| Number of listings | 52 w/Orig. Pr. | 52 | 52 sold | 52 | 25 changed price |
Of these sales 9 were in Fort Atkinson, 7 in Ixonia, 3 in jefferson, 1 in Johnson Creek, 6 in Lake Mills, 12 were in Watertown
Click to view listing(s) (report only good for 30 days)
| This Search Jefferson County October 2008 | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search (52 Matches) | ||||||
| Average | $195,490 | $186,200 | $176,564 | 175 | $-15,097 | -7.5% |
| Median | $176,200 | $171,200 | $163,500 | 149 | $-10,000 | -5.32% |
| Low | $60,000 | $60,000 | $55,000 | 9 | $-74,900 | -32.41% |
| High | $649,900 | $575,000 | $510,000 | 656 | $15,000 | 5.88% |
| Number of Sales | 52 w/Orig. Pr. | 52 | 52 sold | 52 | 32 changed price |
Of these sales 9 were in Fort Atkinson, 4 in Ixonia, 9 in jefferson, 1 in Johnson Creek, 8 in Lake Mills, 15 were in Watertown
Dane County October 2009 Sales under 300,000
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Of these sales 7 were in Cottage Grove, 9 in Middelton, 22 in Sun Prairie, 124 in Madison
Dane County October 2009 Sales over 300,000
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Of these sales 3 were in Cottage Grove, 7 in Middelton, 3 in Sun Prairie, 13 in Madison
Dane County October 2008 Sales under 300,000
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Dane County October 2008 Sales over 300,000
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I hope you enjoy the market data. Bottom line. It is a good time to buy your first home or even sell and upgrade to a larger home.
Brad Koenig, ABR, CRS, GRI, E-PRO and Kati Hatfield Client Care Manager
Your Local Home Team, LLC-First Weber Realtors
www.YourLocalHomeTeam.com Search for homes in the area!
Sold@YourLocalHomeTeam.com 262-719-7393
Office/Cell 262-364-3404 Direct Fax
Proudly Serving Southcentral Wisconsin with Referrals from our Clients
Visit my LinkedIn profile: http://www.linkedin.com/in/bradkoenig
or www.FaceBook.com
When you search homes for sale, you will always see homes listed at $149,900 or $249,900. Why is that? Do you think the home is a deal because it is priced below $150,000 or $250,000?
I am guilty of this myself. In the past I would price homes with this strategy or at an odd price like $148,874 to make it stand out.
I started to think like a buyer and I just recently started pricing homes at an even number. For example $150,000. When do buyers search for homes under $149,900? I am going to guess never. They put in an even number. Some websites only allow you to search by a predetermined drop down box. Buyers may also put in a minimum price range when they search. (Homes between $150,000-$200,000)
So if you price your listing at $149,900 and a buyer puts in a max of $150,000 your listing will show up in the search. It will also show up if you price it at $150,000.
However if a buyer searches between $150,000 and $200,000 your listing at $149,900 will not show up in their search. If you price it at $150,000 it will show up in a buyers search.
Are you curious on the value of your home? Go to www.YourLocalHomeValue.com fill out some information about your home. Then you will be sent a computer generated report for your area. (sorry south central/Milwaukee wisconsin area only)
Here is the first blog post on pricing
http://mywisconsinrealestateblog.com/channels/home_selling/topics/pricing_your_home_in_todays_market
Brad Koenig
www.YourLocalHomeTeam.com
First Weber Realtors
262-719-7393
Many of you ask us "What is going on in my local housing market?"
We will continue to update this on a monthly basis so bookmark this page and visit often...
...or sign up for a monthly email report that is specific to your neighborhood!
Below you will find sales data for Waukesha, Jefferson and Dane Counties.
These sales are single family homes only. If you would like to see postings on Condos, land or any other county let us know.
Compare 2008 vs 2009 notice the Days On Market as well as the average sale price difference.
This is a good time to buy your first home or move up in size. If you are curious on the value of your home visit
| Current Listing | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search Waukesha county under $400,000 2009 | ||||||
| Average | $251,094 | $241,965 | $233,030 | 124 | $-19,911 | -6.86% |
| Median | $234,900 | $229,000 | $221,000 | 67 | $-15,000 | -5.56% |
| Low | $95,000 | $95,000 | $83,200 | 1 | $-119,100 | -29.34% |
| High | $519,000 | $400,000 | $400,000 | 948 | $5,000 | 2.78% |
| 229 w/Orig. Pr. | 229 | 229 sold | 229 | 105 changed price |
Click here to view sold listings in Waukesha county under $400,000 in 2009 (may take a minute to load)
| Current Listing | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search Waukesha county over $400,000 2009 | ||||||
| Average | $704,349 | $650,990 | $607,978 | 188 | $-82,799 | -9.67% |
| Median | $549,900 | $549,900 | $500,000 | 144 | $-38,000 | -7.1% |
| Low | $425,000 | $400,000 | $385,000 | 1 | $-404,000 | -29.3% |
| High | $1,595,000 | $1,399,000 | $1,200,000 | 578 | $-50,000 | -0.11% |
| 45 w/Orig. Pr. | 45 | 45 sold | 45 | 29 changed price |
Click here to view sold listings in Waukesha county over $400,000 in 2009 (may take a minute to load)
2008 Waukesha County Sales
| Current Listing | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search Waukesha county under 400,000 2008 | ||||||
| Average | $256,826 | $249,048 | $239,943 | 109 | $-16,466 | -6.47% |
| Median | $249,900 | $245,000 | $233,500 | 77 | $-10,885 | -4.95% |
| Low | $99,900 | $69,900 | $69,900 | 1 | $-70,000 | -44.04% |
| High | $444,900 | $399,900 | $399,900 | 552 | $10,000 | 4.76% |
| 235 w/Orig. Pr. | 235 | 235 sold | 235 | 111 changed price |
| Current Listing | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search Waukesha county over 400,000 2008 | ||||||
| Average | $660,761 | $633,645 | $587,430 | 153 | $-65,398 | -8.38% |
| Median | $559,900 | $525,000 | $499,900 | 110 | $-55,100 | -9.1% |
| Low | $416,500 | $409,900 | $375,000 | 10 | $-200,000 | -14.81% |
| High | $1,790,000 | $1,790,000 | $1,706,000 | 516 | $-10,000 | -2.38% |
| 41 w/Orig. Pr. | 41 | 41 sold | 41 | 17 changed price |
Compared to last year. Average sale price was only down $6,000 and total units was down
for under $400,000
Sales were up for homes above $400,000 on average of $20,000 with 4 more total units
compared to 2008
Jefferson County Sales
| Current Listing | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search Jefferson County 2009 | ||||||
| Average | $174,904 | $170,547 | $163,666 | 166 | $-13,442 | -7.46% |
| Median | $159,900 | $154,900 | $151,000 | 121 | $-10,000 | -6.71% |
| Low | $1,918 | $40,900 | $40,900 | 1 | $-50,000 | -29.19% |
| High | $399,900 | $399,900 | $399,900 | 855 | $7,000 | 5.39% |
| 69 w/Orig. Pr. | 69 | 69 sold | 69 | 31 changed price |
Click to view listings sold in Jefferson County September 2009
| Current Listing | Original Price | List Price | Sale Price | CDOM | Price Chg | % Price Chg |
| This Search Jefferson County 2008 | ||||||
| Average | $169,857 | $164,861 | $158,838 | 119 | $-14,362 | -11.16% |
| Median | $151,900 | $149,900 | $149,400 | 88 | $-10,550 | -8.39% |
| Low | $44,500 | $39,900 | $35,000 | 6 | $-35,000 | -38.93% |
| High | $339,000 | $339,000 | $331,500 | 544 | $-4,600 | -2.66% |
| 46 w/Orig. Pr. | 46 | 46 sold | 46 | 16 changed price |
Jefferson County sales were up by 23 units and average sale price was up $5000 compared to 2008.
Dane County 2009 September Sales
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Click Here to View Listings Dane County sales under 200,000 2009
Click Here to View Listings Dane County Sales over $200,000 2009
Dane County 2008 September Sales
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Total units was up by 48. Average sale price was down almost $35,000 from this time last year.
Overall buyers are starting to see some real values out there compared to 2006-2008.
Brad Koenig, ABR, CRS, GRI, E-PRO and Kati Hatfield Client Care Manager
Your Local Home Team, LLC-First Weber Realtors
www.YourLocalHomeTeam.com Search for homes in the area!
Sold@YourLocalHomeTeam.com 262-719-7393
Office/Cell 262-364-3404 Direct Fax
Proudly Serving Southcentral Wisconsin with Referrals from our Clients
Visit my LinkedIn profile: http://www.linkedin.com/in/bradkoenig
or www.FaceBook.com
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