The $787 Billion stimulus bill is made up of tax cuts and spending programs aimed at reviving the US economy. Although the package was scaled down from nearly $1 Trillion, it still stands as the largest anti-recession effort since World War II. One of the major benefits of the plan is a tax credit for new homebuyers. According to the plan, first-time homebuyers who purchase homes from the start of the year until the end of November 2009 may be eligible for the lower of an $8,000 or 10% of the value of the home tax credit.
It's important to remember that the $8,000 tax credit is just that... a tax credit. The benefit of a tax credit is that it's a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if you were to owe $8,000 in income taxes and would qualify for the $8,000 tax credit, you would owe nothing.
Better still, the tax credit is refundable, which means you can receive a check for the credit even if you have little income tax liability. For example, if you're liable for $4,000 in income tax, you can offset that $4,000 with half of the tax credit... and still receive a check for the remaining $4,000!
The tax credit starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000.
The tax credit is applicable to any home that will be used as a principle residence. Based on that guideline, qualifying "homes" include single-family detached homes, as well as attached homes such as townhouses and condominiums. In addition, manufactured or homes and houseboats used for principle residence also qualify. Buyers will have to repay the credit if they sell their homes within three years.
Tuesday, February 24, 2009
Thursday, February 05, 2009
Income Tax Change and Mortgage Rate Changes
Hello Everybody!
As many of you know, the U.S. Senate passed a revised homebuyer tax credit yesterday. I want to be sure that you realize that this move is not final. This is part of President Obama's $900 (or so) Billion stimulus package. The rest of the stimulus package has to be decided upon, and then the bill goes to the House for its vote on the measure. There is hope that the Senate can hammer out the rest of the plan by tomorrow, and it can head to the house next week. Then it's on to President Obama's desk for his signature. Few details of the plan have been released. It looks like it will not be repayable, is not limited to first time homebuyers and may include some purchases from 2008. I will give you more details when they become available!
Bank of England -
Today, the Bank of England dropped it's overnight rate to 1% - its lowest level since 1694 (315 years ago). This was also the year that the Bank of England was formed, and the year that Queen Mary II died of smallpox at age 32. Surely we all remember how bad the economy was back then, and how things really turned around after rates hit the 1% level!
Mind the Gap -
While the Bank of England is across the pond, this could prove to be beneficial for our rates, as it lessens the gap between rates abroad and our own rates here!
Have a great day!
As many of you know, the U.S. Senate passed a revised homebuyer tax credit yesterday. I want to be sure that you realize that this move is not final. This is part of President Obama's $900 (or so) Billion stimulus package. The rest of the stimulus package has to be decided upon, and then the bill goes to the House for its vote on the measure. There is hope that the Senate can hammer out the rest of the plan by tomorrow, and it can head to the house next week. Then it's on to President Obama's desk for his signature. Few details of the plan have been released. It looks like it will not be repayable, is not limited to first time homebuyers and may include some purchases from 2008. I will give you more details when they become available!
Bank of England -
Today, the Bank of England dropped it's overnight rate to 1% - its lowest level since 1694 (315 years ago). This was also the year that the Bank of England was formed, and the year that Queen Mary II died of smallpox at age 32. Surely we all remember how bad the economy was back then, and how things really turned around after rates hit the 1% level!
Mind the Gap -
While the Bank of England is across the pond, this could prove to be beneficial for our rates, as it lessens the gap between rates abroad and our own rates here!
Have a great day!
Monday, February 02, 2009
FIVE TIPS TO HELP YOU SELL YOUR HOME FAST
There is no question that houses are taking longer to sell in today's market. As a seller, this slow-down means there is more competition for a limited pool of potential buyers. Consider the following five tips to place your home on the fast track to sale:
Price It Right - The first 30 days are the most critical. If your home is priced too high, interested buyers may never even tour your listing. The longer the property is on the market, the fewer the prospects. Deciding the value of a home isn't an exact science. Yet, there is data to help you determine a fair asking price that is right on target. You may want to hire a real estate appraiser for an objective, unbiased estimate. Then consult with a real estate professional who can help you determine true market value based on a comparable market analysis, which will include recent home sale transactions as well as homes currently on the market. From your analysis, you may want to price your home conservatively to give it a competitive edge.
Make Your Home Irresistible - Unless they are looking for a fixer-upper, most home buyers are more likely to make a bid on a home that they can enjoy immediately. Therefore, you need to create an environment the buyer can't resist. In other words, do everything you can to make the home so attractive, charming, cozy, inviting, comfortable and exciting that a buyer will want to buy that lifestyle for himself. Evaluate the home from a buyer's point of view. An experienced real estate professional will be able to offer an objective view and will also know what buyers are asking for. Get your home in tip-top shape by making repairs and cosmetic improvements, and removing clutter. This may mean investing in a few upgrades to modernize your home's look such as installing newer carpet and light fixtures and painting the walls a neutral shade.
Create Traffic - If you want buyers to see your home, you must first find the buyers. Work with your real estate professional to design a marketing plan that is flexible and capitalizes on your property's most desirable features. Your strategy should include ways to reach buyers online and offline – such as word of mouth, the Internet, yard signs, open houses and so on.
Go with a Professional - Selling a home is more than just putting a sign in your yard and having a listing on the Internet. In a competitive market, you don't really want to take the chance of making novice mistakes that can slow the selling of your home. By hiring a real estate professional, you get the benefit of an experienced marketer and negotiator who is familiar with real estate issues in your community. A real estate professional can offer worthy advice on pricing and staging your home based on their vast experience. Plus, there's the added value of the peer-to-peer networking among real estate professionals, which can bring buyers and sellers together – sometimes even before the property goes on the market.
Offer Incentives - Offering incentives can be just the impetus a potential buyer needs to select your property over others. You may want to consider offering a professional home inspection, home warranty, or allowance for paint or carpet. Don't be discouraged if there are competing homes for sale in your neighborhood. With just a few smart moves, you can turn a buyers' market in your favor.
Price It Right - The first 30 days are the most critical. If your home is priced too high, interested buyers may never even tour your listing. The longer the property is on the market, the fewer the prospects. Deciding the value of a home isn't an exact science. Yet, there is data to help you determine a fair asking price that is right on target. You may want to hire a real estate appraiser for an objective, unbiased estimate. Then consult with a real estate professional who can help you determine true market value based on a comparable market analysis, which will include recent home sale transactions as well as homes currently on the market. From your analysis, you may want to price your home conservatively to give it a competitive edge.
Make Your Home Irresistible - Unless they are looking for a fixer-upper, most home buyers are more likely to make a bid on a home that they can enjoy immediately. Therefore, you need to create an environment the buyer can't resist. In other words, do everything you can to make the home so attractive, charming, cozy, inviting, comfortable and exciting that a buyer will want to buy that lifestyle for himself. Evaluate the home from a buyer's point of view. An experienced real estate professional will be able to offer an objective view and will also know what buyers are asking for. Get your home in tip-top shape by making repairs and cosmetic improvements, and removing clutter. This may mean investing in a few upgrades to modernize your home's look such as installing newer carpet and light fixtures and painting the walls a neutral shade.
Create Traffic - If you want buyers to see your home, you must first find the buyers. Work with your real estate professional to design a marketing plan that is flexible and capitalizes on your property's most desirable features. Your strategy should include ways to reach buyers online and offline – such as word of mouth, the Internet, yard signs, open houses and so on.
Go with a Professional - Selling a home is more than just putting a sign in your yard and having a listing on the Internet. In a competitive market, you don't really want to take the chance of making novice mistakes that can slow the selling of your home. By hiring a real estate professional, you get the benefit of an experienced marketer and negotiator who is familiar with real estate issues in your community. A real estate professional can offer worthy advice on pricing and staging your home based on their vast experience. Plus, there's the added value of the peer-to-peer networking among real estate professionals, which can bring buyers and sellers together – sometimes even before the property goes on the market.
Offer Incentives - Offering incentives can be just the impetus a potential buyer needs to select your property over others. You may want to consider offering a professional home inspection, home warranty, or allowance for paint or carpet. Don't be discouraged if there are competing homes for sale in your neighborhood. With just a few smart moves, you can turn a buyers' market in your favor.
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