Many know that the recently enacted Housing and Economic Recovery Act of 2008 offers relief for some homeowners facing foreclosure, but did you know that the Act provides an excellent opportunity for first time homeowners as well?
The Act provides a $7,500.00 tax credit for First Time Homebuyers on an eligible home purchase. Congress’s intent was to provide as large a financial resource as possible for home buyers in the year that they purchase a home. In addition to helping first-time home buyers, this will maximize the stimulus for the housing market and the economy, will help stabilize home prices, and will increase home sales.
The credit is repayable over 15 years or when the home is sold, if there is sufficient capital gain from the sale, making the credit similar to an interest free loan. The repayment requirement reduces the effect on the Federal Treasury and assumes that home buyers will benefit from stabilized and, eventually, increasing future housing prices.
For more details on the credit, how it works and an example of the repayment process visit the following links:
Tax Credit Chart
Federal First Time Homebuyer Tax Credit Info Site
Tuesday, August 05, 2008
Thursday, July 17, 2008
Is the Housing Crisis Really a Crisis?
You've heard the media scream for months that the nation is in a "housing crisis". Has anyone stopped and really examined the facts?
Dennis Kneale, a commentator on CNBC, recently examined the facts in a "Parting Shot" commentary on Business Nation (click http://www.cnbc.com/id/15840232?video=780461999 to see the video). In it, Dennis explained that we have approximately 120 Million homes in the U.S. 30% of them are owned free and clear (no mortgages), so that means that 40 million homes are not affected by the so called "housing crisis"
Out of the remaining 80 million homes, approximately 50% of those were bought before 2000. Since 2000, median home prices have increased by 53%. Home prices have decreased 12% in the last year, but even so if you bought your home before 2000 and sold, you would be ahead by 34%. By the way, the value of existing homes is only down by 1/4%!
Overall, 95% of all mortgage holders in the U.S. are current on the mortgages, that means that the "housing crisis" is affecting about 4 out of 120 million homes!
We've also heard that foreclosures are up 65% over last year, but did you know that only 2% of homes are in foreclosure. As Dennis said, "Where's the Crisis?"
Yes, some areas have been hit particularly hard by foreclosures such as California, Nevada and Florida, but these are the same areas that saw the largest increase in value. California has more foreclosures than 40 other states combined!
So before you buy into the hype, take a look at the facts!
Dennis Kneale, a commentator on CNBC, recently examined the facts in a "Parting Shot" commentary on Business Nation (click http://www.cnbc.com/id/15840232?video=780461999 to see the video). In it, Dennis explained that we have approximately 120 Million homes in the U.S. 30% of them are owned free and clear (no mortgages), so that means that 40 million homes are not affected by the so called "housing crisis"
Out of the remaining 80 million homes, approximately 50% of those were bought before 2000. Since 2000, median home prices have increased by 53%. Home prices have decreased 12% in the last year, but even so if you bought your home before 2000 and sold, you would be ahead by 34%. By the way, the value of existing homes is only down by 1/4%!
Overall, 95% of all mortgage holders in the U.S. are current on the mortgages, that means that the "housing crisis" is affecting about 4 out of 120 million homes!
We've also heard that foreclosures are up 65% over last year, but did you know that only 2% of homes are in foreclosure. As Dennis said, "Where's the Crisis?"
Yes, some areas have been hit particularly hard by foreclosures such as California, Nevada and Florida, but these are the same areas that saw the largest increase in value. California has more foreclosures than 40 other states combined!
So before you buy into the hype, take a look at the facts!
Monday, June 30, 2008
Have We Hit Bottom Yet?
While the national media keeps droning on and on about the real estate foreclosure crisis, there are some positive signs that we may be close to the "bottom of the market" essential for a turnaround!
According to Lawrence Yun, chief economist for the National Association of Realtors, home sales have stabilized over the last seven months and are expected to increase over the rest of 2008!
Pricing should also improve over the next few months. Cities that have performed steadily over the past few years (like Northeast Ohio) are likely to experience home price gains.
Realtors have reported that buyer traffic is increasing, while seller traffic is moderating, which will help with the supply of homes available nationwide and the home buyer tax credit that passed the House and Senate may help buyers make the decision to buy now!
Another positive sign is that the Pending Home Sales Index, which tracks housing contract activity is starting to climb after 5 months of decline!
Pricing still remains key to selling homes. If your home is currently on the market or you're thinking about selling, examine your pricing strategy. If you've been on the market more than a month and your activity is not meeting your expectations, you may need a price adjustment. I've been counseling my seller's to price their homes at the lowest price their willing to take, with no room to negotiate. That way, they'll know quickly as to if the market will support the price. No showings and/or no offers means that the market doesn't currently support their price, and they may need to look for other options! Following this strategy from the beginning of the listing will alleviate a lot of unrealistic expectations.
According to Lawrence Yun, chief economist for the National Association of Realtors, home sales have stabilized over the last seven months and are expected to increase over the rest of 2008!
Pricing should also improve over the next few months. Cities that have performed steadily over the past few years (like Northeast Ohio) are likely to experience home price gains.
Realtors have reported that buyer traffic is increasing, while seller traffic is moderating, which will help with the supply of homes available nationwide and the home buyer tax credit that passed the House and Senate may help buyers make the decision to buy now!
Another positive sign is that the Pending Home Sales Index, which tracks housing contract activity is starting to climb after 5 months of decline!
Pricing still remains key to selling homes. If your home is currently on the market or you're thinking about selling, examine your pricing strategy. If you've been on the market more than a month and your activity is not meeting your expectations, you may need a price adjustment. I've been counseling my seller's to price their homes at the lowest price their willing to take, with no room to negotiate. That way, they'll know quickly as to if the market will support the price. No showings and/or no offers means that the market doesn't currently support their price, and they may need to look for other options! Following this strategy from the beginning of the listing will alleviate a lot of unrealistic expectations.
Friday, June 20, 2008
Back at It!
Hello again from the edge of oblivion! As you may have noticed, I was neglecting my blog - a major "faux pas".
I'm going to try to stop neglecting my blog - hopefully, my new position within the company - Director of Training and Career Development - will allow me more time and freedom to post my feelings on a wide range of real estate topics.
Look for more posts in the coming days! Let me know if you're reading and if you hate or love them - it just might keep me motivated to keep on posting.
I'm going to try to stop neglecting my blog - hopefully, my new position within the company - Director of Training and Career Development - will allow me more time and freedom to post my feelings on a wide range of real estate topics.
Look for more posts in the coming days! Let me know if you're reading and if you hate or love them - it just might keep me motivated to keep on posting.
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