New legislation, click here for details, extends the $8,000 tax credit to the end of April 2010 and includes the following changes:
*Sales contract deadline is April 30th 2010 and the transaction completed by June 30, 2010. * Income limits have been increased from $75,000 for single people and $150,000 for couples, to $125,000 and $225,000 respectively. * Buyers who have lived in their current home for the last 5 years would be eligible for up to a $6500 tax credit (or 10% of the purchase price). * The maximum allowed home purchase price would be capped at $800,000. * Military personnel, deployed overseas for a minimum of 90-days in 2008 or 2009, would have until April 30, 2011 to claim the tax credit. * To combat fraud, a HUD-1 Settlement Statement will have to be attached to the tax return to secure the credit. You may be thinking: I’m not buying…. so, why should I care? The revision and expansion is good for first-time buyers and all homeowners. As first timers move into the market it takes pressure off the resale inventory. To the extent that existing homeowners who want to move up probably have to sell their existing home, this new credit can have a dramatic impact as in some areas up to 40% of all home sales have involved first time buyers. Foreclosures are impacting the value of your home even if you can't see it happening. First-Timers generally buy at the low end of the market and will absorb these abandoned homes. Those who are currently homeowners and want a new home stimulate the economy before during and right after a move and the $6500 credit again will have an impact. Studies have shown that first-time buyers have a significant impact on the local economy and contribute in other socially positive ways. A thriving resale market helps maintain home prices as they recover from the recent downfall. If the new tax credit works as well, it could aid the sales of hundreds of thousands of additional homes, sopping up more of the excess inventory. And that's exactly what you want to happen: Home values will not stabilize and increase until the inventory of homes for sale is diminished. Feel free to contact us for information on current market conditions and home values in the Pinehurst, NC area.
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Wayne and Lynda Gomillion
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