February 26, 2009

Ready to own your first house? Congress sweetens the deal

The 2009 economic stimulus bill, passed in February, offers first time home buyers a nifty perk: A 10 percent tax credit up to $8,000 for home purchases made in 2009.
The tax credit is limited to buyers who have never purchased a home or those who haven't owned a home in three years.
Last year Congress passed a similar tax credit but there is one significant difference between that one and this new credit: You don't have to pay back the new credit.
In addition this new credit is 'refundable.' That means the credit pays for the taxes you owe and if the credit is more than the taxes owed, you get a check for the difference.
The tax credits make the decision of whether to rent or own a much easier one and it seems buyers are making their move.
The most recent home sales figures (from December 2008) show a 6.5 percent increase in home sales. This surge in home sales, especially in the midwest and south, suggest that tax credits, plus favorable buying conditions have made home ownership very affordable.
Right now interest rates are at 5 percent or lower while home prices are very reasonable. Some experts say the combination has made homes more affordable today than they have been in 20 years. That means you can own a great home sometimes for the same cost as renting.
Homeownership has been called 'The American Dream,' because homeowners take great pride in owning a slice of America. As a homeowner, you can make your home and your lot into exactly what you want, tailoring it to suit your tastes and life style.
What many non-homeowners do not realize is that their home, and the improvements they make on it, increase in value over time. That is one reason why homeowners are worth 35 times more than the average renter. According to David Bach, author of The Automatic Millionaire Homeowner, real estate is the best way to take an ordinary income and expand it.
"As long as you're alive, you have to live somewhere. Why not let where you live make you rich?" Bach writes.

1 comment:

Dad (Mark) said...

Great post Dianne.

I posted the IRS form that your buyers will need in order to claim the $8,000 first time homebuyer tax credit on my blog.

We just dropped the price on 585 Marigold Drive in Franklin to $425,000. This makes us the best value in sought after WillowSprings.

Call our agent, Mark Dobberstein from Bob Parks at (615) 479-6334 for more details.

Thanks and have a good weekend.