Optimism for the Housing Market

Falling interest rates, an improving economy and a last bit of economic stimulus are helping the housing market stage a revival. In April alone, sales of existing homes jumped 23% from a year ago, according to the trade organization National Association of Realtors. Sales of new homes rose even faster, up 48% from a year ago. What's more, a growing number of economists believe the three-year plunge in housing prices is at an end.

-- "Is the Housing Market on the Rebound?," by Stephen Gandel, Time Magazine, May 26, 2010.

• The PHSI in the Northeast declined 3.3 percent to 75.1 in March, but remains 27.2 percent higher than March 2009.
• In the Midwest the index increased 1.2 percent to 98.9 and is 18.5 percent above a year ago.
• Pending home sales in the South jumped 12.7 percent to an index of 121.2, which is 28.3 percent higher than March 2009.
• In the West the index rose 1.9 percent to 99.9 and is 8.8 percent above a year ago.

“Another encouraging sign is the improvement in the availability for jumbo and second-home mortgages,” Yun said. “As bank balance sheets strengthen, it is just a matter of time before lending of non-government-backed mortgages steadily opens up.”

Source: NAR

Humane Resources: Kim Pontius and the Green Solutions 4 Expo

• 10. Pueblo, CO

  

  During one weekend every September, a tiny chile pepper nearly doubles the size of the city of Pueblo. Up to 100,000 visitors from all over the U.S. come to eat, drink and celebrate the “Pueblo Chile”  during the Pueblo Chile and Frijoles Festival. But anytime is a good time for foodies in Pueblo. The famed fire-roasted chile spices up burgers, hot dogs, tamales and more as restaurants pay homage, and the Farmers Market along the Riverwalk brings a bounty of fresh produce from local farmers. Locals swear by local favorite Magpies, the downtown restaurant featuring a fully stocked taproom downstairs. More microbrew suds are on tap at the popular Shamrock Brewing Co. And downtown bistro Restaurant Fifteen Twentyone fuses seasonally fresh ingredients with classic French culinary style. 

   

• 9. Logan, UT

  

  Hiking, biking and rock climbing around the beautiful Cache Valley area can work up an appetite. Fortunately, getting your fill isn't tough in Logan, Utah. Locals get their carbs with fresh baked bread and gourmet cookies from Old Grist Mill Bread Co. For the “best steaks in the Cache Valley,” according to Frommer's, head to Hamilton's, where the menu focuses on seafood and steaks perfectly prepared in the restaurant's open kitchen. More fine dining awaits with the sleek and contemporary Elements restaurant. A local favorite is Angie's Diner, home of the famous “Kitchen Sink” ice cream sundae. Bluebird Cafe, a classic soda fountain, has been serving up ice cream treats for nearly 100 years.

   

• 8. Wichita, KS

  

  If you're a native of Wichita, you've probably craved a loose-meat sandwich. Like a crumbly hamburger, the delicacy is a citywide obsession prepared for decades at Nu Way Cafe, a local fast-food chain also famous for its homemade root beer. Finer dining options abound also, and the city likes its sweets. Both Cero's Candy and Cocoa Dulce offer inventive as well as classic confections crafted from high-quality ingredients. For local suds, try River City Brewing Co., a popular brewpub in a converted warehouse in historic Old Town.

   

• 7. Albuquerque, NM

  

  Marrying traditional New Mexican cuisine with an independent spirit and hunger for diversity, Albuquerque boasts a truly vibrant dining scene. Named one of the 10 Best Cities for Local Food by the Huffington Post, the city also offers standout farm-to-table offerings like Flying Star Café, which uses fair trade, natural and organic ingredients. Beverages get a fair shake, too, with the unique artisan coffeemaker New Mexico Piñon Coffee and a number of wineries earning national acclaim. One of the oldest wineries in New Mexico, Casa Rondena recently got a nod from national food magazine Saveur for its Meritage Red, named among the 10 best reds in the U.S.

   

• 6. Eugene, OR

  

  Eugene comes about its growing food and wine reputation naturally. With the longest-standing farmers market in the U.S., a thriving slow sood movement and two-thirds of the state's wineries and vineyards in Willamette Valley, the city has all the right ingredients for an organic paradise. The area is home to a variety of successful organic food processors as well as upscale restaurants like Wine Spectator favorite Adam's Sustainable Table and artisanal shops like Euphoria Chocolate Co. Willamette Valley, Oregon's leading wine region, is home to more than 200 wineries and has been recognized as one of the premier pinot noir producing areas in the world.

• 5. Walnut Creek, CA
  

  

  Although it is next door to the foodie mecca that is the San Francisco Bay Area, the cozy community of Walnut Creek has enough culinary heft to stand on its own. Its annual Art and Wine Festival, recognized by the Contra Costa Times as East Bay’s Best Outdoor Festival, draws 100,000 visitors annually to sample award-winning local and regional wines and microbrews and delicacies from dozens of local restaurants. Some eateries worth more than just a taste include the back-to-basics bakery Walnut Creek Baking Co., tapas favorite Va De Vi and the Zagat-rated Italian mainstay Prima, which features one of the most extensive and distinguished wine collections in the world. Walnut Creek dining also boasts a bit of star power – guitarist Carlos Santana is a partner at Maria Maria, the regional Mexican restaurant chain that began here and is named for the musician's 1999 hit song.

• 4. Kansas City, MO

   

  
  

  Only in a city that's truly serious about its barbecue reputation could you find the Kansas Barbeque Society, the world's largest organization of barbecue and grilling enthusiasts. There are about 100 barbecue joints smoking in Kansas City, melding a mix of flavors and styles from across the country. But it's not all 'cue in KC – foodies can find a wide variety of cuisine ranging from earthy organic to decadent crepes to Stroud's, one of the last traditional fried chicken restaurants in the U.S. Esquire recently lauded the eatery as one of the restaurants “Where Men Eat,” writing: “the fried-chicken dinners are as fabulous as ever – cooked to order in a black skillet, served with … hot cinnamon rolls so good you’ll steal from your kid’s plate."

• 3. Boulder, CO

  

  Boulder's growing culinary scene and healthy reputation find a delicious way to bridge the gap between good and good-for-you. At fine dining restaurants like Salt, Black Cat Bistro and Frasca Food and Wine the emphasis is on seasonal, local ingredients – most of which come from  Boulder's well-established farmers markets. Combine that spirit with the town's health-conscious nature – it's won numerous titles as a top vegeterian-friendly dining choice – and it's little wonderThe Wall Street Journal recently called Boulder the "best small city for great meals we know of in this country."

   

• 2. Asheville, NC

  

  In earthy Asheville, food is so elemental that the locals have coined their own word for the city: Foodtopia. A thriving farm-to-table scene, a flourishing network of family farms and farmers markets and a growing roster of award-winning chefs combine to create the ideal food climate in Asheville. Year-round local food tours lead visitors to locally roasted coffee, gourmet shops and chocolatiers, artisan bakeries, specialty shops and breweries. Along with its 135 restaurants, 11 annual food festivals and 17 farmers markets, Asheville has a dozen microbreweries and five annual beer festivals – numbers that propelled travel blog Gadling.com to name Asheville one of the best cities in the world for drinking beer.

   

• 1. Traverse City, MI

  

   

  Known as the Cherry Capital of the World, the Lake Michigan resort town of Traverse City does a pretty good job with other foods, too. With plenty of award-winning restaurants, wineries, farmers markets and dairies, Traverse City has been called “a new foodie haven” by The Huffington Post, and Midwest Living magazine recently named it second on its list of the region's “best food towns.” At the heart of the accolades is an emphasis on the farm-to-table philosophy. At Trattoria Stella, where chef Myles Anton was nominated for a 2010 James Beard Foundation award, the menu of Italian fare takes care to note ingredients from local farms and dairies. For wine lovers, the city's Leelanau Peninsula and Old Mission Peninsula wine regions lie along the 45th parallel— the same latitude that gives the Bordeaux region of France its famous reputation. Get started with a self-guided foodie tour.

   

  So this is our list of the top 10 of the best food cities that might surprise you. Agree? Disagree? What city (and why) do you think is missing from the list?

  Check out our other Top 10 lists and discover more interesting facts about America's best places to live.

First, the Federal Reserve's Mortgage Backed Securities (MBS) purchase program will come to an end on March 31, just two weeks away! Without this program home loan rates could have been at least 1.00% higher...and potentially even higher...over the last year. Throughout 2009, the Federal Reserve was the primary buyer for MBS, purchasing as much as 80% of the supply in a given month. When this program ends, a lack of willing buyers will likely cause MBS prices to drop and rates to rise as a result.

In a recent Wall Street Journal article, it was estimated that 37% of all borrowers with a 30-year fixed rate have interest rates of 6% or higher. The article also quotes Credit Suisse that more than half could lower their rate by nearly 0.75%.

For prospective homebuyers, any increase in interest rates erodes your purchasing power. In other words, a 1% increase in rate represents an approximate decline in purchasing power by 10%. For example, if rates increase by 1%, people who qualify for a $200,000 purchase price today may only qualify for a purchase price of $180,000 afterwards.

The second shot will come on April 30th, which is the deadline for purchasers to get under contract to qualify for the Home Buyer Tax Credit program, which has been providing a tax credit of up to $8,000 to first time homebuyers and up to $6,500 to repeat purchasers.

If you or anyone you know is looking to purchase or refinance a home, waiting could be costly!

Appeals court: No tax bump

Ruling says families can transfer home to next generation without tax hike

BY BRIAN McGILLIVARY
bmcgillivary@record-eagle.com

TRAVERSE CITY -- A local woman's victory in a state appeals court will allow families to transfer a home from one generation to the next without an accompanying hike in property taxes.

The appellate court ruled in a unanimous opinion released Wednesday that Traverse City improperly lifted the taxable assessed value on Terrie Taylor's bayfront home on Peninsula Drive.

"It's huge," said Robert Parker, Taylor's attorney. "This is going to change a lot of things about estate planning, if it stands."

City Attorney Karrie Zeits called the court's ruling "overly broad ... and potentially disastrous." She expects the city will appeal.

An almost identical case decided in December, Klooster vs. Charlevoix, dictated its decision in Taylor, the court said.

Taylor's father listed her as a joint tenant on the property deed about a month before his death in 2005. The following year the city boosted the assessment and increased Taylor's taxes by about $4,000 annually.

The court ruled ownership did not change hands because of the joint tenancy, and the taxable value should have remained capped.

State law limits increases in a property's taxable value to the rate of inflation. When the property is sold or transferred, even in family trusts popular among estate planners, it becomes uncapped. The usually higher assessed value then becomes the taxable value used for tax bills.

Taylor's taxable value jumped almost $100,000 when the city assessor uncapped it. Under the court ruling the 2009 taxable value will drop from $293,579 to about $191,000 and the city will owe her more than $16,000 in back taxes, interest and attorney fees.

Charlevoix also appealed in the Klooster case, and Parker said if the ruling holds, he expects joint estate planners to move homes out of trusts and into joint tenancy to avoid taxes.

Zeits said the court created a new rule that goes beyond family transactions. "Anyone could structure a transaction to fall within the court's new parameters, and potentially we could never have a property that becomes uncapped," Zeits said.

Taken to its limits, joint tenancy literally could last one minute among buyer and seller, Zeits said.

Parker said it's possible the ruling could be used to disguise property sales, but said those weren't the facts in the Klooster and Taylor cases.

"I'm not sure that would really work," he said.

City assessor Debra Chavez said the decision will have a negative financial impact on city, county, and school tax revenues, but the situation would be considerably worse under Zeits' theory.

"I believe it would pretty much bring government to its knees. There would be no way local governments could survive," Chavez said. "The legislature knew government can't live on the rate of inflation alone, and that's why they put uncapping in there."

http://www.federalhousingtaxcredit.com/faq2.php

Frequently Asked Questions
About the Move-Up/Repeat Home Buyer Tax Credit

The Worker, Homeownership, and Business Assistance Act of 2009 has established a tax credit of up to $6,500 for qualified move-up/repeat home buyers (existing home owners) purchasing a principal residence after November 6, 2009 and on or before April 30, 2010 (or purchased by June 30, 2010 with a binding sales contract signed by April 30, 2010).

The following questions and answers provide basic information about the tax credit. If you have more specific questions, we strongly encourage you to consult a qualified tax advisor or legal professional about your unique situation.

1. Who is eligible to claim the $6,500 tax credit?
2. What is the definition of a move-up or repeat home buyer?
3. How is the amount of the tax credit determined?
4. Are there any income limits for claiming the tax credit?
5. What is “modified adjusted gross income”?
6. If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
7. Can you give me an example of how the partial tax credit is determined?
8. How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008? How is this different than the rules established in early 2009?
9. How do I claim the tax credit? Do I need to complete a form or application? Are there documentation requirements?
10. What types of homes will qualify for the tax credit?
11. I read that the tax credit is "refundable." What does that mean?
12. Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
13. Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
14. I am not a U.S. citizen. Can I claim the tax credit?
15. Is a tax credit the same as a tax deduction?
16. Is there a way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 or 2010 tax return?
17. HUD allows “monetization” of the tax credit. What does that mean?
18. If I’m qualified for the tax credit and buy a home in 2009 (or 2010), can I apply the tax credit against my 2008 (or 2009) tax return?
19. For a home purchase in 2009 or 2010, can I choose whether to treat the purchase as occurring in the prior or present year, depending on in which year my credit amount is the largest?

1. Who is eligible to claim the $6,500 tax credit?
   Qualified move-up or repeat home buyers purchasing any kind of home are eligible to claim this credit.
   
2. What is the definition of a move-up or repeat home buyer?
   The law defines a tax credit qualified move-up home buyer (“long-time resident”) as a home owner who has owned and resided in a home for at least five consecutive years of the eight years prior to the purchase date. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. Repeat home buyers do not have to purchase a home that is more expensive than their previous home to qualify for the tax credit.
   
3. How is the amount of the tax credit determined?
   The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $6,500. Purchases of homes priced above $800,000 are not eligible for the tax credit.
   
4. Are there any income limits for claiming the tax credit?
   Yes. The income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) above those limits. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $145,000 (single) or $245,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.
   
5. What is “modified adjusted gross income”?
   Modified adjusted gross income or MAGI is defined by the IRS. To find it, a taxpayer must first determine "adjusted gross income" or AGI. AGI is total income for a year minus certain deductions (known as "adjustments" or "above-the-line deductions"), but before itemized deductions from Schedule A or personal exemptions are subtracted. On Forms 1040 and 1040A, AGI is the last number on page 1 and the first number on page 2 of the form. For Form 1040-EZ, AGI appears on line 4 (as of 2007). Note that AGI includes all forms of income including wages, salaries, interest income, dividends and capital gains.
   
   To determine modified adjusted gross income (MAGI), add to AGI certain amounts of foreign-earned income. See IRS Form 5405 for more details.
   
6. If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
   Possibly. It depends on your income. Partial credits of less than $6,500 are available for some taxpayers whose MAGI exceeds the phaseout limits.
   
7. Can you give me an example of how the partial tax credit is determined?
   Just as an example, assume that a married couple has a modified adjusted gross income of $235,000. The applicable phaseout to qualify for the tax credit is $225,000, and the couple is $10,000 over this amount. Dividing $10,000 by the phaseout range of $20,000 yields 0.5. When you subtract 0.5 from 1.0, the result is 0.5. To determine the amount of the partial first-time home buyer tax credit that is available to this couple, multiply $6,500 by 0.5. The result is $3,250.
   
   Here’s another example: assume that an individual home buyer has a modified adjusted gross income of $138,000. The buyer’s income exceeds $125,000 by $13,000. Dividing $13,000 by the phaseout range of $20,000 yields 0.65. When you subtract 0.65 from 1.0, the result is 0.35. Multiplying $6,500 by 0.35 shows that the buyer is eligible for a partial tax credit of $2,275.
   
   Please remember that these examples are intended to provide a general idea of how the tax credit might be applied in different circumstances. You should always consult your tax advisor for information relating to your specific circumstances.
   
8. How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008? How is this different than the rules established in early 2009?
   The previous tax credits applied only to first-time home buyers and were for different amounts of money.
   
9. How do I claim the tax credit? Do I need to complete a form or application? Are there documentation requirements?
   You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on line 67 of the 1040 income tax form for 2009 returns (line 69 of the 1040 income tax form for 2008 returns).
   
   No other applications are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and repeat home buyer tests. Note that you cannot claim the credit on Form 5405 for an intended purchase for some future date; it must be a completed purchase. Home buyers must attach a copy of their HUD-1 settlement form (closing statement) to Form 5405 as proof of the completed home purchase.
   
10. What types of homes will qualify for the tax credit?
    Any home that will be used as a principal residence will qualify for the credit, provided the home is purchased for a price less than or equal to $800,000. This includes single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats. The definition of principal residence is identical to the one used to determine whether you may qualify for the $250,000 / $500,000 capital gain tax exclusion for principal residences.
    
    It is important to note that you cannot purchase a home from, among other family members, your ancestors (parents, grandparents, etc.), your lineal descendants (children, grandchildren, etc.) or your spouse or your spouse’s family members. Please consult with your tax advisor for more information. Also see IRS Form 5405.
    
11. I read that the tax credit is “refundable.” What does that mean?
    The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.
    
    For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $6,500 home buyer tax credit. As a result, the taxpayer would receive a check for $5,500 ($6,500 minus the $1,000 owed).
    
12. Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
    Yes. For the purposes of the home buyer tax credit, a principal residence that is constructed by the home owner is treated by the tax code as having been “purchased” on the date the owner first occupies the house. In this situation, the date of first occupancy must be after November 6, 2009 and on or before April 30, 2010 (or by June 30, 2010, provided a binding sales contract was in force by April 30, 2010).
    
    In contrast, for newly-constructed homes bought from a home builder, eligibility for the tax credit is determined by the settlement date. Be sure to check with a tax advisor in cases where a HUD-1 form is not used at settlement to be sure you have sufficient documentation to attach to IRS Form 5405.
    
13. Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
    Yes. The tax credit can be combined with an MRB home buyer program.
    
14. I am not a U.S. citizen. Can I claim the tax credit?
    Perhaps. Anyone who is not a nonresident alien (as defined by the IRS) and who has owned and resided in a principal residence in the United States for at least five consecutive years of the eight years prior to the purchase date can claim the tax credit if they meet the income limits. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. The IRS provides a definition of “nonresident alien” in IRS Publication 519.
    
15. Is a tax credit the same as a tax deduction?
    No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $6,500 in income taxes and who receives an $6,500 tax credit would owe nothing to the IRS.
    
    A tax deduction is subtracted from the amount of income that is taxed. Using the same example, assume the taxpayer is in the 15 percent tax bracket and owes $6,500 in income taxes. If the taxpayer receives a $6,500 deduction, the taxpayer’s tax liability would be reduced by $975 (15 percent of $6,500), or lowered from $6,500 to $5,525.
    
16. Is there a way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 or 2010 tax return?
    Yes. Prospective home buyers who believe they qualify for the tax credit are permitted to reduce their income tax withholding. Reducing tax withholding (up to the amount of the credit) will enable the buyer to accumulate cash by raising his/her take home pay. This money can then be applied to the downpayment.
    
    Buyers should adjust the withholding amount on their W-4 via their employer or through their quarterly estimated tax payment. IRS Publication 919 contains rules and guidelines for income tax withholding. Prospective home buyers should note that if income tax withholding is reduced and the tax credit qualified purchase does not occur, then the individual would be liable for repayment to the IRS of income tax and possible interest charges and penalties.
    
    In addition, rule changes made as part of the economic stimulus legislation allow home buyers to claim the tax credit and participate in a program financed by tax-exempt bonds. As a result, some state housing finance agencies have introduced programs that provide short-term second mortgage loans that may be used to fund a downpayment. Prospective home buyers should check with their state housing finance agency to see if such a program is available in their community. To date, 18 state agencies have announced tax credit assistance programs, and more are expected to follow suit. The National Council of State Housing Agencies (NCSHA) has compiled a list of such programs, which can be found here.
    
17. HUD allows “monetization” of the tax credit. What does that mean?
    It means that HUD will allow buyers using FHA-insured mortgages to apply their anticipated tax credit toward their home purchase immediately rather than waiting until they file their 2009 or 2010 income taxes to receive a refund. These funds may be used for certain downpayment and closing cost expenses.
    
    Under the guidelines announced by HUD, non-profits and FHA-approved lenders are allowed to give home buyers short-term loans. The guidelines also allow government agencies, such as state housing finance agencies, to facilitate home sales by providing longer term loans secured by second mortgages.
    
    Housing finance agencies and other government entities may also issue tax credit loans, which home buyers may use to satisfy the FHA 3.5 percent downpayment requirement.
    
    In addition, approved FHA lenders can purchase a home buyer’s anticipated tax credit to pay closing costs and downpayment costs above the 3.5 percent downpayment that is required for FHA-insured homes.
    
    More information about the guidelines is available on the NAHB web site. Read the HUD mortgagee letter (pdf) and an explanation of the FHA Mortgagee Letter on Tax Credit Monetization (pdf). An FAQ about monetization (pdf) is available at the NAHB web site.
    
18. If I’m qualified for the tax credit and buy a home in 2009 (or 2010), can I apply the tax credit against my 2008 (or 2009) tax return?
    Yes. The law allows taxpayers to choose (“elect”) to treat qualified home purchases in 2009 (or 2010) as if the purchase occurred on December 31, 2008 (or if in 2010, December 31, 2009). This means that the previous year’s income limit (MAGI) applies and the election accelerates when the credit can be claimed. A benefit of this election is that a home buyer in 2009 or 2010 will know their prior year MAGI with certainty, thereby helping the buyer know whether the income limit will reduce their credit amount.
    
    Taxpayers buying a home who wish to claim it on their prior year tax return, but who have already submitted their tax return to the IRS, may file an amended return claiming the tax credit using Form 1040X. You should consult with a tax professional to determine how to arrange this.
    
19. For a home purchase in 2009 or 2010, can I choose whether to treat the purchase as occurring in the prior or present year, depending on in which year my credit amount is the largest?
    Yes. If the applicable income phaseout would reduce your home buyer tax credit amount in the present year and a larger credit would be available using the prior year MAGI amounts, then you can choose the year that yields the largest credit amount.

For those of you keeping score on the first time home buyer tax credit extension, here is the latest:

— The tax credit would be $8,000 for first-time home buyers and $6,500 for move-up buyers (from December 1, 2009 to April 30, 2010).

— Move-up buyers will be eligible, so long as the home they are leaving has been used as their principal residence for 5 years or more. 

— The tax credit would sunset on April 30, 2010. However, there would a binding contract rule that will permit those with contracts as of April 30th to qualify for the credit so long as they complete the transaction within 60 days.

— The income limits for both first-time home buyers and move-up buyers would be $125,000 for single return and $225,000 joint return.

— Cost of the home may not exceed $800,000 to be eligible.

— For purchases made in 2010, taxpayers would be able to claim the credit on their 2009 income tax return.

— Home buyers would not have to repay the credit, provided the home remains their principal residence for 36 months after the purchase date.

— The amendment includes a military waiver provision, meaning the recapture provision would not apply in the case of a member of the Armed Forces, military intelligence or Foreign Service who is on qualified official extended duty. In addition, members of the military who have been deployed overseas for 90 days or more in 2008 or 2009 would have until April 30, 2011, to claim the home buyer tax credit.

— The amendment also includes anti-fraud language that provides math authority to the IRS to do greater oversight during the processing of the return rather than waiting for an audit situation. The amendment requires the taxpayer claiming the credit to be 18 or older as well as requiring a HUD-1 settlement statement to be attached when claiming the credit. 

AND supposedly, sometime after 11a, the Treasury and HUD Secretaries will officially call on Congress to extend the credit and the higher conforming loan limits.

From Fox Business

Existing home sales jumped much more than expected in September, the National Association of Realtors reported Friday, with the nation’s inventory of homes dropping to its lowest level in more than two years.

The industry group said existing home sales jumped 9.4% in September to a seasonally-adjusted rate of 5.57 million annualized units. It was much more than 5.35 million units economists had been expecting, according to estimates provided by Thomson Reuters.

“Much of the momentum is from people responding to the first-time buyer tax credit, which is freeing many sellers to make a trade and buy another home,” said NAR’s Chief Economist Lawrence Yun in a statement.

Economists agreed that the jump in sales, while positive, may be partially related to the timing of the home-buyer tax credit, which is set to expire at the end of the year.

“As we close in on the end of the period in which one can successfully close on their home in time to qualify for the first time home buyers credit, a tick higher for the month is not surprising at all and entirely within reasonable expectation levels,” said Dan Greenhaus, with the brokerage house Miller Tabak.

The nation’s home inventory fell to 3.63 million existing homes available for sale, NAR said, representing a 7.8-month supply, down from a 9.3-month supply in August. Unsold inventory is 15% below a year ago.

Sales increased in all major tracked geographical divisions in the country. In the Northeast, sales rose 4.4%, up 11.8% from a year ago. The median price in the Northeast was $234,700, down 7% from a year ago.

In the Midwest, sales rose 9.6%, up 7.8% from a year ago. The median price in the Midwest was $147,600, down 1% from a year ago. In the South, existing-home sales rose 9%, up 10.8% from a year ago. The median price in the South was $153,500, down 7.6% from a year ago.

Existing-home sales in the West jumped 13%, at levels 5.7% higher than a year ago. The median price in the West was $219,000, which is 15.% below September 2008.

According to the NAR, first-time home buyers accounted for more than 45% of home sales during the past year and distressed (foreclosed) homes accounted for 29% of transactions in September.

http://www.youtube.com/napstv#p/a

http://today.msnbc.msn.com/id/26184891/vp/33191501#33191501

The $8,000 New Home Buyer Tax Credit (along with the Cash-for-Clunkers) may have dominated the headlines recently, but some energy efficiency Tax Credits offered by the federal government could be even more useful for the average homeowner. You may be eligible for a tax credit equal to 30 percent of the cost of materials (up to $1,500) for certain products purchased between January 1, 2009 and December 31st, 2010.

Below are the rating specifications for eligible energy efficiency products:

Call Linda 231 633 2202     Call Julia 231 534 4600

http://www.upnorthlive.com/news/video.aspx?id=329307

While the economy continues to show signs of improvement and many housing markets are beginning to heat up, scores of would-be buyers are still waiting on the sidelines for further positive housing trends. But for first-time buyers, time is running short on the federal government's $8,000 tax credit.

Though the official expiration date of the credit is December 1, in reality on-the-fence buyers will need to make a decision one way or the other fairly soon. The reason: in order to qualify for the credit, the home purchase must close by December 1st. Merely having loan approval, an accepted offer or a signed contract won't be enough to qualify for the Housing and Economic Recovery Act

Decision-Making Timeline - While each transaction is unique, closing a real estate deal is no speedy matter. On average, closing takes place 45 to 60 days after the date that the contract is signed. In order to meet the December 1st deadline, this would mean having a signing date in late September or early October. Those who consider the tax credit an important incentive but are still unsure about entering the market will need to make a decision one way or another before many more summer days pass.

To have any chance at finding a home and having an offer accepted by early October, buyers will want to wade into the home buying process right away. The immediate steps include making a final list of desired home attributes, scouting favorite neighborhoods and areas, contacting a bank for mortgage pre-approval and beginning the home search process online.

Potential for Delays - Buying a home is a complicated process, and it is not unusual for purchases involving first-time buyers to take slightly longer than those involving experienced buyers. Some of the delays that first-time buyers may face over the coming months:

Competition with Other Buyers
While home may be selling at a lower rate than in years past, in many areas changes in inventory have created extremely competitive buying environments. Foreclosures or other homes with greatly lowered asking prices are particularly sought after, and in many cases investors are very active in the marketplace.

Disclosures & Contingencies The seller is obligated to disclose any material facts about the property, including any property defects or any lawsuits regarding claim to ownership on the property. Disclosures can stall negotiations and delay the contract signing depending on their nature and severity. Contingencies (written clauses in the sales contract that give protection to both the buyer and the seller of a home) can also result in some delay in negotiation, particularly if the contingency requires the seller to make specific repairs.

Appraisal
The lender will arrange for appraisal of the property, which will include a thorough inspection of the home's interior and exterior. The appraiser's report will describe the physical characteristics of the property and comparable property values will be used to determine the value of the property. If the appraisal of the home's value is lower than the agreed upon sales price, the buyer's chance of loan approval can be in jeopardy. In addition, recently added rules for appraisers have been causing some delays based upon anecdotal evidence.

Loan Approval
While interest rates remain advantageous for buyers, lenders are being much more fastidious during the approval process. Obtaining pre-approval can help prevent many delays.

The Holiday Season
Buyers who submit an offer in mid-fall may likely run into another roadblock to a pre-December 1st closing date: the approaching holiday season. Closing a real estate sale requires the work and attention of a number of professionals; from real estate agents to attorneys to bankers. Like many Americans, it is not uncommon for individuals in these fields to use up vacation time in the last few weeks of November. Securing a closing date during Thanksgiving week may be something approaching miraculous.

Additional Delays for Short Sales and Foreclosures
Buyers who make an offer on a short sale property or bank-owned foreclosure may find that it takes a significantly longer time to receive a reply than expected. Overall, buying these types of properties is a longer process than buying homes listed on the market by individual owners.

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If you are thinking of selling your home now is the time to put your home in order.  To gain an edge within the Real Estate market, your home must be priced right and look better than the competition. 

Please call us if you are looking for contact details for local inspectors.  We would be happy to help.

Linda and Julia