Life has been good the last year or so for first time buyers. With an extra $8000 in their pocket, the prospect of investing hundreds of thousands of dollars in a new home has been a lot better. For those who have waited or weren't ready, what does the future hold? Will the tax credit be extended?
The National Association of Realtors chief economist, Lawrence Yun sure hopes so. He believes an extension of the tax credit is essential to preserving the incentives for financially qualified buyers. Speaking of which, I have noticed that becoming financially qualified is much more difficult than it was a couple of years ago. Banks and other lending institutions are tightening restrictions on mortgage loans to the point that us realtors are pulling our hair out! For those of us who have been in the business more than 15 years, it's simply back to the old days. This is how it used to be. "You mean you actually need to have money for a down payment?!" Uhhh... yea, you do. You also need to prove where that money came from. 100% financing and no documentation loans are all but over. That's what got us into this housing crisis in the first place.
So, back to the real issue... will we see an extension of the tax credit? I don't know, but I sure hope so too. In Omaha, we have seen an impressive surge of first time buyers come into the market. I have even seen a few competing offers on a few listings. I didn't see that happening in a down economy! Those new homeowners are excited about using their tax credit to add on to their home, put in a new kitchen, or invest/save. We have also seen the Omaha metro's inventory go down by 17% in the last year or so, and the entry level market has seen pending sales go up by nearly 50%!!! That's huge people. I'll keep you posted on the tax credit news....
Stay tuned...
Oh By the way... I'm never too busy for any of your referrals!
Monday, October 12, 2009
Tuesday, September 29, 2009
I'm waiting for 4% rates to come back...
Well, I got news for ya... it ain't gonna happen any time soon. In fact home mortgage interest rates will soon be on the rise. By spring time, experts expect rates to be above 6%. Those are still very good rates, historically speaking, yet not quite as favorable as rates are currently (in the 5's). Why is this... do you ask? Well, there are a number of factors involved. The main issue today is the federal reserve.
The Fed has been buying lots and lots of mortgage backed securities lately to help pull this economy and housing market out of the gutter. Well... it's been working! The down side to that is there will be a point of diminishing returns. Eventually, the Fed has to stop buying all those mortgage backed securities. When that happens, and it will soon, mortgage rates will rise to the 6's at least. They are trying their best to make this a gradual rise, but if you or someone you know is waiting to buy until interest rates are down, wait no longer. You first time buyers, especially, have about three weeks to get a new home under contract. Call, text, email, fax the Beers Team with further questions about this or anything else involving real estate. We feel that educating our clients is our number one priority!
Oh By the way... I'm never too busy for any of your referrals!
The Fed has been buying lots and lots of mortgage backed securities lately to help pull this economy and housing market out of the gutter. Well... it's been working! The down side to that is there will be a point of diminishing returns. Eventually, the Fed has to stop buying all those mortgage backed securities. When that happens, and it will soon, mortgage rates will rise to the 6's at least. They are trying their best to make this a gradual rise, but if you or someone you know is waiting to buy until interest rates are down, wait no longer. You first time buyers, especially, have about three weeks to get a new home under contract. Call, text, email, fax the Beers Team with further questions about this or anything else involving real estate. We feel that educating our clients is our number one priority!
Oh By the way... I'm never too busy for any of your referrals!
Friday, September 11, 2009
Check out this OWH article discussing the Omaha City Council's battle over how to balance the budget. Homeowners, this definitely affects you! They say... "a 10% tax hike" is inevitable.
http://tinyurl.com/lkyakf
Oh By the way... I'm never too busy for any of your referrals!
http://tinyurl.com/lkyakf
Oh By the way... I'm never too busy for any of your referrals!
Friday, June 12, 2009
Yard care tips
Warm weather is here! The smells of summer are upon us, and everyone is outside playing with their kids, going to ball games, and working in the yard. If anyone is like me, they love to have a nice yard and landscaping to work on. Sometimes it seems like those flowers just won't bloom, or that one patch of grass is always dead or brown. Why is that?
I'd like to refer everyone to a website that has complete and comprehensive information concerning all things yardcare. It is yardcare.com, and it will turn your brown thumb green in no time!
You can receive expert advice on lawns, landscape ideas, flower ideas, gardening tools and everything else you can think of when it comes to your yard. Again, check it out at www.yardcare.com. Have a great summer!
Oh By the way... I'm never too busy for any of your referrals!
I'd like to refer everyone to a website that has complete and comprehensive information concerning all things yardcare. It is yardcare.com, and it will turn your brown thumb green in no time!
You can receive expert advice on lawns, landscape ideas, flower ideas, gardening tools and everything else you can think of when it comes to your yard. Again, check it out at www.yardcare.com. Have a great summer!
Oh By the way... I'm never too busy for any of your referrals!
Wednesday, April 1, 2009
Mortgage Interest for Homeowners
Ahhh, it's my favorite time of year, tax season. As I become more seasoned as a Realtor, I am coming to the realization that taxes are inevitable, and it's up to us to take advantage of every opportunity that we can. As a homeowner, I rely on deducting my mortgage interest each year. It takes a big chunk off of my tax burden, and it is one of the reasons I own a home today. For those of you who are self-employed, you can understand that we need all the deductions we can get! Self-employed or not, mortgage interest deduction is a big part of your tax return.
Some lawmakers are threatening to take away mortgage interest deduction. This talk must be stopped. It will affect us all adversely. Cutting out MID will most certainly lower property values that are already at lows that homeowners are struggling to cope with. Even if only the top level mortgages lose MID, it will most certainly have a trickle down affect on all housing markets. Each market segment is affected by all market segments and vice versa. In terms of property values, at a minimum, homes would lose in value what is equal to the present value of the tax burden being taken away. That value is currently estimated at $90-130 Billion! Losing that much in consumer dollars would be catastrophic to an already fragile economy. I will keep you all in the loop with further developments, but let's fight to keep mortgage interest deduction.
Oh By the way... I'm never too busy for any of your referrals!
Some lawmakers are threatening to take away mortgage interest deduction. This talk must be stopped. It will affect us all adversely. Cutting out MID will most certainly lower property values that are already at lows that homeowners are struggling to cope with. Even if only the top level mortgages lose MID, it will most certainly have a trickle down affect on all housing markets. Each market segment is affected by all market segments and vice versa. In terms of property values, at a minimum, homes would lose in value what is equal to the present value of the tax burden being taken away. That value is currently estimated at $90-130 Billion! Losing that much in consumer dollars would be catastrophic to an already fragile economy. I will keep you all in the loop with further developments, but let's fight to keep mortgage interest deduction.
Oh By the way... I'm never too busy for any of your referrals!
Monday, February 23, 2009
New Housing Tax Credit Q & A's
It’s time to let everyone know! There is a new Tax Credit for First Time Homebuyers. I’m sure a lot of you have questions about it. Who does it benefit? What does the fine print say? How long will this last? Have no fear… I have the simple answers! Know that this is a phenomenal deal for those who qualify.
Here are some popular Q & A’s:
1)Who is eligible?
A: First time homebuyers are eligible. To qualify, the purchase must be made between January 1, 2009 and before December 1, 2009. In this case, the purchase date means the date of closing.
2)Who is a first time buyer?
A: To qualify, the purchaser must not have owned a principal residence during the 3 year period prior to the purchase. For married persons, the law tests the homeownership history of both people, however unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first time buyer.
3)How is the tax credit amount determined?
A: The amount is equal to 10% of the purchase price, up to a maximum of $8,000.
4)Are there income limits for claiming the tax credit?
A: The credit is reduced for buyers with a modified adjusted gross income of more than $75,000 for single taxpayers and $150,000 for married couples filing a joint return. For those singles making $95,000 and married couples making $170,000, the tax credit is reduced to zero.
5)How does this tax credit differ from the last homebuyer tax credit?
A: The main difference is that this credit does NOT have to be repaid! Remember, the buyer must use the home as their principal residence for at least 3 years or face recapture of the tax credit.
6)How do I claim the tax credit?
A: This is easy! You claim the credit on your federal income tax return. Complete IRS form 5405 to determine your credit amount. Then, claim this amount on line 69 of your 1040 tax form. That is it!
7)Is there any way for a homebuyer to access the tax credit money sooner than waiting for their 2009 tax return?
A: Yes. Prospective homebuyers who qualify are permitted to reduce their income tax withholding. Reducing their withholding (up to the amount of the credit) will enable buyers to accumulate cash by raising his/her take home pay. This extra cash can be used as a down payment if the buyer budgets well. Contact your tax advisor if you are interested in this plan.
Oh By the way... I'm never too busy for any of your referrals!
Here are some popular Q & A’s:
1)Who is eligible?
A: First time homebuyers are eligible. To qualify, the purchase must be made between January 1, 2009 and before December 1, 2009. In this case, the purchase date means the date of closing.
2)Who is a first time buyer?
A: To qualify, the purchaser must not have owned a principal residence during the 3 year period prior to the purchase. For married persons, the law tests the homeownership history of both people, however unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first time buyer.
3)How is the tax credit amount determined?
A: The amount is equal to 10% of the purchase price, up to a maximum of $8,000.
4)Are there income limits for claiming the tax credit?
A: The credit is reduced for buyers with a modified adjusted gross income of more than $75,000 for single taxpayers and $150,000 for married couples filing a joint return. For those singles making $95,000 and married couples making $170,000, the tax credit is reduced to zero.
5)How does this tax credit differ from the last homebuyer tax credit?
A: The main difference is that this credit does NOT have to be repaid! Remember, the buyer must use the home as their principal residence for at least 3 years or face recapture of the tax credit.
6)How do I claim the tax credit?
A: This is easy! You claim the credit on your federal income tax return. Complete IRS form 5405 to determine your credit amount. Then, claim this amount on line 69 of your 1040 tax form. That is it!
7)Is there any way for a homebuyer to access the tax credit money sooner than waiting for their 2009 tax return?
A: Yes. Prospective homebuyers who qualify are permitted to reduce their income tax withholding. Reducing their withholding (up to the amount of the credit) will enable buyers to accumulate cash by raising his/her take home pay. This extra cash can be used as a down payment if the buyer budgets well. Contact your tax advisor if you are interested in this plan.
Oh By the way... I'm never too busy for any of your referrals!
Friday, February 20, 2009
Buy First or Sell First?
This is a great topic for the current market conditions. The answer, of course, depends on the situation in which each homeowner is involved. Most markets are seeing high inventory and not enough buyers to lower those levels. So what do you do? Some sellers choose to carry a bridge loan. This will help them to buy before they sell. A bridge loan helps borrowers by halting payment on their new home until their old home sells.
While this is an option, the old home may not sell. Some research shows less than 50% of homes listed do NOT sell. In a buyer's market such as the one we are in, It is wise to sell before you buy. In a seller's market, it may be a smarter choice to find your new home before you sell because the amount of buyers outweigh the number of homes on the market. This fosters competition and quick turnaround for listings.
I would advise my clients in our current market to do a few things before they decide to make any decisions. Sellers should find out what they owe on their current house. They should get prequalified for a home loan to see how much they can afford for a new home. They could also find out if they qualify for a bridge loan. Their lender should give them a good faith estimate of settlement costs. This will show them what their payments and settlement costs will be for their new home purchase. Sellers will also incur some closing costs on the sale of their current home. When we perform a market analysis, we always provide our prospective sellers an estimated costs to sell sheet. This will give them a pretty good idea what they can expect to net from the sale of their home.
Oh By the way... I'm never too busy for any of your referrals!
While this is an option, the old home may not sell. Some research shows less than 50% of homes listed do NOT sell. In a buyer's market such as the one we are in, It is wise to sell before you buy. In a seller's market, it may be a smarter choice to find your new home before you sell because the amount of buyers outweigh the number of homes on the market. This fosters competition and quick turnaround for listings.
I would advise my clients in our current market to do a few things before they decide to make any decisions. Sellers should find out what they owe on their current house. They should get prequalified for a home loan to see how much they can afford for a new home. They could also find out if they qualify for a bridge loan. Their lender should give them a good faith estimate of settlement costs. This will show them what their payments and settlement costs will be for their new home purchase. Sellers will also incur some closing costs on the sale of their current home. When we perform a market analysis, we always provide our prospective sellers an estimated costs to sell sheet. This will give them a pretty good idea what they can expect to net from the sale of their home.
Oh By the way... I'm never too busy for any of your referrals!
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