This is a Sponsored Post written by me on behalf of Coldwell Banker. All opinions are 100% mine.
First-time homebuyers have one more reason to be happy – the federal income tax credit for homebuyers has been improved and extended through April 30th, 2010. Originally set to expire on December 30, 2009, the tax credit was extended by Congress and signed into law by President Obama, with some improvements that are expected to aid in the recovery of our economy.
According to the 2009 National Association of Realtors Profile of Home Buyers and Sellers, the number of first time home buyers rose from 41 to 47 percent of all home sales, the highest on record. The previous high was 44 percent in 1991. While it’s clear the first-time tax credit was working, it was missing an important element – incentive for the move-up buyer.
With the 2010 Homebuyer Tax Credits, first-time homebuyers, or those who have not owned a home in the last three years, are eligible to receive up to an $8,000 tax credit. Current homeowners (move-up buyers) who have lived in their home for 5 of the last 8 years can receive up to a $6500 tax credit when purchasing a home.
Who does it Benefit?
Ultimately, the new tax credits will benefit everyone. According to the Joint Center for Housing Studies at Harvard, real estate comprises 21% of the gross domestic product in the US. Real estate has led our country out of every major downturn and recession since the 1950s. For every home that is sold in the US, approximately $60,000 goes back into the local economy, according to the National Association of Realtors and Mark Zandi of Moody’s Economy.com. Essentially, each home sale creates one job over the next 12 months.
What are the Limitations?
In order to qualify for the tax credits, income limitations are $125,000 for individuals and $225,000 for married couples, with $20,000 phase out of the credit for both. Contracts must be completed by April 30th, and properties must be closed by June 30th.
Qualified homebuyers are urged to act now
The 2010 Homebuyer Tax Credits expire on April 30th, and there is no guarantee of another extension. For more information, watch this short video, talk to a realtor, or visit ColdwellBanker.com.
