|By Dennis Phillips, email@example.com |
POSTED: April 19, 2010
The $8,000 first-time homebuyer tax credit that was part of the economic stimulus package and extended in November will be coming to an end April 30 and a binding sales contract will be needed with the closing by June 30 to qualify.
Also, the tax credit was extended to anyone who has owned their current house at least five years. They too are eligible for a tax credit of up to $6,500 for purchasing a new home.
Couples earning as much as $225,000 and individuals earning up to $125,000 would qualify for the tax credit. That was also an increase from the original stimulus package that had a $75,000 limit for individuals and $150,000 for couples.
With the deadline approaching, Jan Murray, Chautauqua County Board of Realtors executive officer, said she believes some people are trying to get the paperwork finished by the end of the month.
''I think they are (trying to beat the deadline). Although, a lot of people, I believe, have already purchased (who wanted the tax credit),'' she said.
Ms. Murray is not alone in thinking that people will try to make the cutoff by the end of the month.
''We anticipate another flurry of market activity in late March and April as both first-time and trade-up buyers seek to get their next home under contract before the April 30 deadline," said Duncan R. MacKenzie, NYSAR chief executive officer, last month in a news release. ''The federal tax credit program's success in aiding the housing market recovery can already be seen in the market activity of the last several months and will continue to be reflected in sales data through the middle of 2010.''
Many realtors believe the program jumpstarted the slumping housing market during the last year. The state's housing market continued to post double-digit sales gains compared to a year ago as February 2010 sales jumped 13.2 percent, according to sales data accumulated by the New York State Association of Realtors. The statewide median sales price rose by more than 12 percent compared to February 2009.
''The second consecutive month of double-digit sales increases compared to a year ago is a very positive indicator of the strengthening of the Empire State's housing market,'' MacKenzie said. ''The New York State housing market is starting 2010 significantly stronger than 2009 both in terms of sales and median sales price growth.''
Ms. Murray believes that not only did the housing tax credit help the real estate market, but other areas of the economy as well.
''I think it helped the whole market in general during the winter,'' she said. ''I think it helped the economy in general with furniture and all the other amenities that go with buying a house.''
Ms. Murray said even with the zero hour approaching for the tax credit, that is not the only element pushing sales.
''I know real estate agents are busy right now. A lot of them are very busy. Even the higher-priced homes and not first-time buyers (are interested in purchasing a house). They're generally busier,'' she said.
Ms. Murray said there was some talk of the tax credit program being extended again, but the buzz has died down and doesn't seem to be a possibility now. However, Ms. Murray said she is thankful the government did offer and extend the program for homebuyers in the first place.
''I appreciate that the lawmakers went through with this and helped the economy in that way,'' she said. ''I think it was a boost to the economy when we needed it.''