Atlanta?s Real Estate Blog
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Tax Credit Extention!
The Homebuyer Tax Credit has been extended! This is great news for the economy and future homebuyers. President Obama signed it into law earlier this week. It has been extended until April 30th, 2010. There have also been a few improvements to the bill. In addition to the $8,000 tax credit for first-time buyers ($4,000 if married), there is a $6,500 tax credit for current homeowners ($3,500 if married). Current homeowners must have used the home being sold as a principal residence for five consecutive years within the previous eight in order to be eligible. There is now a binding contract rule. It states that a contract must be binding by April 30th and must close by July 1st. The income limit has been raise to $125,000 from $75,000 for singles and to $225,000 from $150,000 for those that are married. A dependent can no longer purchase and the home must cost no more than $800,000. Last but not least, the purchaser must attach documentation of purchase to your tax return in order to comply with an anti-fraud rule. The Atlanta real estate market has stabilized and this improved tax credit bill may help change the current economic direction. I'm excited to see what 2010 has to bring and look forward to seeing you and the closing table!
Housing Market to Recover!
Some analysts believe that Atlanta?s housing market will be among the first to recover. Our home prices didn?t suffer the massive hit that several other large cities did. While Las Vegas, Phoenix, and South Florida had an economic boom, Atlanta?s economy grew at a modest three percent. Our economy didn?t descend as hard as other cities and will not have to fight as hard to improve. Atlanta?s strong economy and low housing prices is the perfect recipe for an economic recovery.
February may have signaled the end of metro Atlanta?s economic downturn as home prices dropped to eight year lows. March may have signaled a turning point. Home values began stabilizing and that trend is expected to remain constant for several months.
Also: Housing affordability reached its highest levels in five years according to the National Association of Home Builders/Well Fargo Housing Opportunity Index (HOI).
The $8,000 Tax Credit & You
Here are a few facts about the $8,000 tax credit that you may or may not know.
? It applies to first time home buyers
? You are considered a first time home buyer if: you & your spouse (if married) have not owned a main residence in past 3 years
? Home must be purchased before December 31, 2009
Your tax credit may be smaller if?
? You are married and filling separately
? The credit exceeds 10% of the purchase price of the home.
You Do Not Qualify if?
? Your modified adjusted gross income (MAGI) exceeds $95,000 ($170,000 if married filing g jointly)
? You?ve received the first home by gift or inheritance
You may not be able to receive the full credit amount if your MAGI is $75,000 or less ($150,000 if married filing jointly)
For further information about the First-Time Homebuyer Credit, please visit:
http://www.irs.gov/newsroom/article/0,,id=204671,00.html
http://www.irs.gov/pub/irs-pdf/f5405.pdf
Our economy has a pulse!
The stock market has experienced multiple days with significant gains, consumer spending has increased, jobs are being created, and the real estate market is showing signs of stabilization. In an addition to the market stabilizing, we are heading into the summer, which is real estate?s busy season. Yes, it feels good to finally hear positive economic news, but is it time to exhale?
Recently, the Federal government passed an $8,000 tax credit bill and bought $750 billion in mortgage-backed securities in an attempt to lower interest rates. So far, both efforts are helping to stimulate the economy. Lenders are beginning to issue new loans and interest rates are at historic lows.
The government has done about all they can do. Now it is up to you! Since the banks have tightened credit standards, it is your responsibility to make sure you have and keep good credit. First, you should pay off any debt. When debating whether to pay off debt or save? pay off the debt. Money sitting in a savings account will have a low return on interest while your credit card interest will be significantly higher. Paying off the higher interest will save more money than earning a low return. Also, the lender looks at your debt to income ratio first, then they look at your savings.
Metro Atlanta home prices are at the lowest they?ve been in 9 years. The time to buy is now. Even when the market rebounds, it will not rebound at the rate as it did in recent years. This means that if your credit & savings are not where they need to be, now is the time to work on it. Because one thing is for sure, the market will rebound. That is the economic cycle. Owning a home is a proud responsibility. With a little bit of financial discipline and patience, it can be a reality. The season is upon us, the time is now. Take advantage of the current economic climate & let your dreams materialize.
