Home buying tax credits aren't just for 1st timers...

Home sales rise to highest level since February '07

Due in large part to the old deadline for the first-time home buyer credit. Before the credit was extended to April 30th, 2010, buyers were rushing to close on their first home by November 30th, 2009. Naturally, this caused October home sales to rise drastically.

A few weeks ago, President Obama signed an extension to the $8k credit into law. In addition, there is a new credit for current homeowners so they can get $6500 if they buy a new home. For both credits, you must have a new home under contract by April 30th. The rules of the credits allow until June 30th for those contracts to finalize financing and close the transaction.

I am not alone in thinking that the extension and expansion of the home buyer tax credits will bring the typical spring buying season a little bit earlier than usual.

Read the full article here.

Crunch time for 1st-time buyers...

We've reached the midway point in September and any potential 1st-time home buyer must get a home under contract soon or risk the possibility of not qualifying for the $8k tax credit. Average time to close a home from accepted offer to closing the transaction is about 45 days. Making an offer today and not experiencing any bumps in the road would mean closing at the end of October. Since today's lending market is the equivalent of a gravel forest service road, buyers are almost certainly going to experience at least a few minor bumps or delays. It's imperative to give yourself a cushion to close before 11/30/09.

Here's a Seattle Times article that discusses the countdown toward the deadline.

1st Time Buyer Alert!

Less than $200k for a cute townhome!

Extend and expand the 1st time buyer credit?

Rumblings about a possible extension on the 1st-time buyer tax credit have been growing lately. Let's hope the government abides by the old philosophy of, "If it ain't broke, don't fix it."

Unless of course they want to give all buyers even more money!

Here's a recent article from the Seattle Times about efforts to extend the credit and even raise the dollar amount.

First-time home buyers success stories

This is another article from the Seattle Times (the city's last print newspaper) on a couple success stories involving first-time home buyers in Seattle. Every situation is different but there are certainly many deals to be had here in Seattle. Since when can a person buy a home for $350k in a great Seattle neighborhood?!

Read the full article here.

Homebuyers emerge for spring season

I hope that this blog can offer fair and objective takes on various aspects of the real estate market here in Seattle. The last thing I want this to be is a sounding board for every positive piece of news regarding real estate and nothing realistic or sobering. I especially have a distaste for "glass half full" people that like to skew statistics and information to make everything sound peachy! That being said, I have a direct investment in seeing this market turn around for the better...so I get excited when I see articles published such as the one below. This article does a good job of stressing caution when looking at the recent gains in home sales. Furthermore, since Seattle eased into the housing slump versus crashing into it, our area may also see a more gradual rebound.

Read the full article here.

$7,500 tax credit may be yours forever!

Who couldn't use an extra $7,500? In an effort to spur potential home buyers into the market, Congress passed a bill for a first-time home buyer tax credit. In short, here's how it currently works: If you haven't owned a home in the last three years, meet certain income restrictions and buy a house between April 8th, 2008 and July 1st, 2009...you can apply for the tax credit of up to $7,500. This amount minus any taxes you owe Uncle Sam is yours on either your 2008 or 2009 refund (depending on when you buy). The catch is that you must pay it back with 0% interest over 15 years. Not bad...but nothing to get excited about.

The latest stimulus package that President Obama is attempting to push through Congress has a few minor tweaks to the tax credit that result in some major changes. Nothing is official but here is a simplified version of the changes: you don't have to pay the $7,500 back! Ever! Now that's a reason to jump of the fence if I've ever heard one. The National Association of Realtors is lobbying to push the July 1st deadline back to December 31st of 2009 which would give buyers more than a couple months to close after the bill passes next month (assuming it does!).

So with houses on sale in nearly every market; interest rates at historic lows and Uncle Sam giving you $7,500...what reason would you have not to buy your first house?

Seattle Times article discussing proposed changes to tax credit.

FHA rehab loans

For those of you who are unfamiliar with Federal Housing Administration (FHA) financing...I highly suggest you peruse this Seattle PI article. Especially if you or someone you know is considering buying a home in the Seattle area. Once upon a time FHA loans were reserved for low income home buyers or those with poor credit. The last several years, the program fell out of favor more trendier loan programs (the infamous subprime loans). This past year, Washington has seen a major increase in loans through the traditional FHA program as well as their rehab loan program.

In a very basic sense, the FHA rehab loan provides up to $35k in additional funds to fix or rehab the purchased home. As we've seen a slight increase in foreclosed homes and homes remaining vacant for a year or more...these rehab funds are great! FHA loans are very good option for first-time home buyers in Seattle and King County.

Read the full article here.

Seattle Real Estate 2009 Outlook

I saw this article over my time off over Christmas. It's an article from the Seattle Times regarding the upcoming year in regards to the Seattle real estate market. Everywhere you turn, another source's cyrstal ball seems to say something different about where Seattle's housing market is headed. Bottom line is nobody knows with any certainty.

The only thing we know for certain is that Seattle home prices are down to where they were 2-3 years ago. While this isn't great for more recent buyers, it's not the end of the world. Not to mention people who have owned for 1o years or more are still sitting on a fat pile of equity. In addition to more affordable prices, interest rates are at historical lows.

While this article is an interesting read...please take from it that the future looks rosier than last year but we're not out of the woods quite yet. The old saying, "Buy low, sell high." is repeated more often than it is followed. Now is a low point for Seattle housing and low interest rates make it that much more prime to buy now.

Read the full article here.

1st time home buyer heaven...

As a real estate agent, I get extremely frustrated with our local and national media when they refuse to cover the positives of our current real estate market. Seattle is weathering this unpleasant storm extremely well and has all the fundamentals for an eventual rebound. Seattle recently made Forbes magazine as one of the most likely cities to rebound first.

That being said, my friends at the Seattle Times recently published a great article on the possibilities for first-time home buyers. People who qualify to buy a house for the first time are in a position they might not see for another 10 years. Furthermore, once they start buying, this will allow current sellers to move on and move up. This in effect will help lead our area out of a slow housing market. So let's all cheer on those first-time home buyers!

Read the full article here.

Tax credit for new homebuyers...

The Housing and Economic Recovery Act of 2008 was a part of recent legislation passed with the intention of easing the economic woes of Americans. Part of that legislation is a tax credit for first-time homebuyers. Please consult with a tax professional prior to applying for this credit.

Highlights of the tax credit:

• Amount of Credit: 10% of home, not to exceed $7500


• First-time homebuyer only: Purchaser and purchaser's spouse may not have owned a principal residence within the past 3 years.


• Effective date: purchases on or after April 9th, 2008


• When to apply?: Available when filing 2008 or 2009 taxes


• Income Limit: Full amount available for individuals with AGI of no more than $75k or $150k for a joint return.


• Refundable: Yes. This credit reduces income tax liability for the year of purchase. Claimed on tax return for that tax year.

THE CATCH!: The credit must be paid back at the rate of $500 per year. If the house sells at a loss before the balance is paid off, then the balance is forgiven. If the house sells for a profit, the balance is paid off through those proceeds. In short, this acts as a 0% interest loan from the government.