Tax Credit

New-Home Sales Decline

After increasing for five consecutive months, new-home sales declined 3.6 percent in September compared with August to a seasonally adjusted annual rate of 402,000, the Commerce Department reported yesterday.

Sales were down 7.8 percent compared to September 2008.

Most of the decline was in the West and the South, where sales fell 11 percent and 10 percent respectively. These reduction were offset by transactions in the Midwest, where sales jumped 34 percent.

Analysts were surprised by the decline, and some blamed it on the first-time home buyer tax credit, which sucked up customers eager to buy foreclosure bargains. Others said that the new normal for time between signing the sales contract and closing is two months or longer, a reality that could be reflected in these numbers.

“We don’t know yet if it’s anything more than a blip,” says Steven Ricchiuto, an economist for Mizuho Securities USA.

Source: Washington Post, Renae Merle (10/29/2009)

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Tax Credit

Mortgage Demand Down as Summer Ends

Mortgage applications slowed as summer ended and potential first-time buyers wondered whether they would be able to settle in time to receive the federal home ownership tax credit, which expires Dec. 1.

The Mortgage Bankers Association index declined 8.6 percent last week on a seasonally adjusted basis, including an adjustment for the Labor Day holiday. On an unadjusted basis, the index declined 18.3 percent compared with the previous week and fell 18.7 percent compared with the same week a year ago when the Labor Day holiday fell nearly a week earlier.

Mortgage interest rates movements were as follows:

* 30-year fixed-rate mortgages increased to 5.08 percent from 5.02 percent.
* 15-year fixed-rate mortgages decreased to 4.41 percent from 4.45 percent.
* 1-year ARMs decreased to 6.61 percent from 6.69 percent.

Source: Mortgage Bankers Association (09/16/2009)

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Tax Credit

Economists: Extend the Housing Tax Credit

More than 40 percent of all home buyers in 2009 will qualify for the federal tax credit, costing the government about $15 billion, twice the original estimate, but most housing experts applaud the policy and favor expanding it.

Now the decision is up to Congress.

Mark Zandi, chief economist for Moody’s Economy.com, believes that the credit should be expanded to all homebuyers, even investors, through summer of 2010. “The risks of not doing something like this are too great,” he said. “I don’t think the coast is clear.”

James Glassman of JPMorgan Chase also favors expanding the credit but continuing to limit it to first-time buyers.

Industry members who are lobbying for the extension are optimistic and say they believe an extension will be approved in some form. “There will be a lot of water under the bridge, a lot of compromise, between now” and a final bill, said Richard A. Smith, chairman of the Business Roundtable’s Housing Working Group.

Source: The New York Times, David Streitfeld (09/15/2009)

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Tax Credit

Congress Urged to Extend Tax Credit

The National Association of REALTORS® is calling upon its 1.2 million members to urge Congress to extend the successful homebuyer tax credit into next year.

Since its inception earlier this year, the $8,000 first-time homebuyer tax credit has brought 1.2 million new buyers into the market—350,000 of whom would not have purchased a home without the credit, according to NAR. The credit is due to expire November 30.

“Now is the time for Congress to keep this recovery going by extending the tax credit through 2010 and making it available to more homebuyers. We have all seen how the credit has been a spur to bring homebuyers into the market, and have seen the beginnings of a real recovery in the housing market. Housing has always led this nation out of economic downturns, and can do so again,” said NAR President Charles McMillan.

Write Congress Now

REALTORS®, the leading advocates for homeownership and housing issues, will be writing to their Senators and Representatives to tell them of the successes with the tax credit thus far, and press them to extend and expand it now.

McMillan added that the market has improved, but it has not yet fully corrected itself. “The credit needs to be available for an additional period of time in order to sustain the progress that’s been made so we can continue to see our markets fully recover. Uncertainty about the future of the credit will dampen consumer demand. The only way we can assure that the progress we’ve made can continue is to extend the credit and to do that now,” he said.

As the current deadline for the credit looms, potential homebuyers need to complete a contract, satisfy any contingencies, secure financing, and go to closing by November 30. In today’s market, NAR estimates that it generally is taking between 45 and 60 days from contract to closing.

“That means potential homebuyers who qualify must act now, and so must Congress,” McMillan said.

Source: NAR

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Tax Credit

Buyers Rush to Beat Tax Credit Deadline

Real estate professionals report that first-time home buyers are flooding the sale market, pressed to finalize a deal before the federal government’s $8,000 tax credit offer expires on Nov. 30.

Because mortgage approvals, residential inspections, and other steps in the buying process typically take about two months, buyers hoping to take advantage of the incentive will need to have a contract by the end of September.

The new flurry of activity now as house-hunters try to meet the deadline is triggering bidding wars and energizing the property market, which historically is slow at the end of summer. As a result, more homes are getting their full asking price.

Source: Chicago Tribune, Kathleen Lynn

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Tax Credit

New Programs Target Low-Income Buyers

Under the federal Neighborhood Stabilization Program, many new state and local initiatives are expected to roll out in the next few weeks that will help middle- and low-income families buy foreclosed homes in hard-hit neighborhoods.

In all, about $5 billion is available, including $50 million in technical assistance to get the programs up and running. Regulations limit participation to households earning no more than 120 percent of the median income with 25 percent of the money going to families earning less than half the median.

The funds must be used for primary residences in communities with the highest incidences of foreclosures and subprime loans. There also will be a lease-to-own program.

The Neighborhood Stabilization Program was authorized last summer, but it has been rolling out slowly because the volume of paperwork involved has stymied communities.

Source: CNNMoney.com, Les Christie (06/24/2009)

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222

Tax Credit

Federal Home Buyer Tax Credit Could Be Expanded

A first-time home buyer tax credit of up to $8,000 has helped to move housing inventory during an otherwise sluggish real estate cycle. Now both legislators and the business community are hoping to build on the incentive’s success by expanding it.

A number of bills have been introduced in the House and the Senate that lobby for an expansion of the measure. Among the proposed changes:

* Setting a new cap of $15,000.

* Extending the tax break into mid-2010.

* Making the benefit available to all home buyers, not just first-timers.

* Offering a separate tax credit to $3,000 for borrowers who refinance.

USA Today, Stephanie Armour (06/22/09)

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222

Tax Credit

City of Marietta, Cobb & Cherokee County 1st Time Homebuyer Programs

First Home Down Payment Assistance Program
The program has up to $7,500 of funds available through a 0% interest rate, with no amortization, due upon conveyance of the deed. Income limits are 80% of HUD Area Median Income Limits.  Borrower contribution is 1% – 3% of sales price.  Purchase price limit is between $170,000.

Individual Development Account Program
Grant from United Way. Provides first time homebuyer with pre-purchase counseling, economic literacy classes and down payment assistance.

Section 8 (Voucher Homeownership) Program
This program allows subsidies once applied to rental payments to be utilized for mortgage payments. This program is designed to increase wealth, build stronger communities and help renters realize the dream of homeownership. CHI provides credit counseling, life skills training, financial/literacy training, budget counseling and lending. We make second mortgage loans upto $25,000 for 10 years. Maximum purchase price is $160,000.

Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222

Tax Credit

Fed Gov’t Tax Credit Can Be Used for Housing Down Payment

Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, on Tuesday said that the Federal Housing Administration is going to permit its lenders to allow home buyers to use the $8,000 tax credit as a down payment.

Previously, most buyers wouldn’t receive the funds until after they filed their tax return, and that deterred some people from using the credit. The NATIONAL ASSOCIATION OF REALTORS® has been calling for the change.

“We all want to enable FHA consumers to access the home buyer tax credit funds when they close on their home loans so that the cash can be used as a down payment,” Donovan says. His remarks came in an address to several thousand REALTORS® gathered Tuesday morning at “The Real Estate Summit: Advancing the U.S. Economy,” at the 2009 REALTORS® Midyear Legislative Meetings & Trade Expo in Washington, D.C..

He says FHA’s approved lenders will be permitted to “monetize” the tax credit through short-term bridge loans. This will allow eligible home buyers to access the funds immediately at the closing table.

Other Solutions for Today’s Market

During his address at the summit, Donovan went on to say that the Obama administration plans to further stabilize the housing market. “I do think we have some early signs that the market overall is stabilizing,” Donovan says. “Since January we’ve seen both home sales moving up and down around a relatively stable number and we are seeing the first signs that the rapid decline in home prices is starting to abate.”

The morning session included a panel discussion that was moderated by CNBC’s Ron Insana. Panelists examined cutting-edge solutions necessary to promote and preserve homeownership and real estate development, stimulate the economy, and protect the nation’s taxpayers. They also shared their ideas on what the role and responsibility of the federal government is in the revitalization effort.

“Right now the Federal Reserve is the market,” said panelist Jay Brinkman, chief economist for the Mortgage Bankers Association. “What will be the effect when the Fed stops buying?” Brinkman explained that an exit strategy must be planned for the long-term; the federal government cannot continue to support the mortgage markets indefinitely.

“We are thrilled that so many high-caliber individuals were able to join us today at this important meeting to promote stability in the housing market and the U.S. economy,” said NAR President Charles McMillan. “We look forward to an ongoing dialogue and action toward this goal, during our midyear meetings this week and beyond.”

The real estate summit is part of the 2009 REALTORS® Midyear Legislative Meetings & Trade Expo. During the week ending May 16, more than 8,500 REALTORS® will attend meetings, visit lawmakers and inspire action on Capitol Hill.

Source: NAR

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222

Tax Credit

Atlanta Opportunity Downpayment Assistance Program

The Opportunity Downpayment Assistance Program (ODAP) is being sponsored by the Atlanta Development Authority.  It’s a City of Atlanta Downpayment Assistance Program.

• First Time Homebuyer – No
• Funds Available – 10% of Sales Price
• Area Served – City of Atlanta
• Income Limits – $71,200 – 1-2 person household; $81,880 3+ person household
• Type of Program – 10 yr. deferred, 0% interest 2nd mortgage
• Borrower Contribution Amount – $1,500
• Purchase Price Limit – $252,890

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Elliott Robinson, JD – Associate Broker
Adams Realtors
458 Cherokee Ave. SE
Atlanta, GA 30312
(o) 404-688-1222

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