The Clock in Running!

While you’ve probably heard a lot in the media about the government’s efforts
to rejuvenate the housing market with the first-time home buyer tax credit, you
might have missed the fact that the most recent expansion of the legislation
also includes a $6,500 credit for current homeowners who want to purchase a new
home…commonly referred to as “moving up.”

As a Member of the Top 5 in Real Estate Network®, I’ve worked with many
homeowners who have wanted to move to a new home over the past year, but have
stayed put due to a lack of confidence in the market. Now, however, thanks to
the tax advantages of the Worker, Homeownership, and Business Assistance Act of
2009, these homeowners are moving off the sidelines and purchasing the homes
they’ve always wanted.

But the time to act is now—there is only a short window of opportunity! The
move-up buyer credit expires in April of 2010, which means you must contract
and close on your home purchase by June 30, 2010. As you know, selecting a home
is not a simple process, so start your search now so you don’t miss the

starters, here are the key facts you need to know about the move-up buyer tax

1. A qualified current homeowner who wishes to move
to a different home (a ‘move-up’ buyer) must have owned and resided in their
residence for five consecutive years out of the last eight. It’s not enough
that you have been homeowners for five years—you must have been in the same
home for five consecutive years.

2. Single taxpayers with incomes up to $125,000 and
married couples with a joint income up to $225,000 qualify for the full tax
credit. According to Goldman Sachs, these income limits make approximately 70%
of current homeowners eligible for the credit.

3. The maximum credit amount for current homeowners is $6,500. Under the new
legislation, a tax credit may only be issued for homes purchased for $800,000
or less.

4. Even though the term “move-up” is used to describe these buyers, the credit
is not predicated on buying a home of higher value than your current home.

5. Move-up buyers are not required to sell their current home to qualify for
the credit. They must reside in the new home for at least three years, but they
can keep their existing home and either leave it vacated or use it for rental


These are just a few of the key facts surrounding
the move-up buyer tax credit. If you would like to find out more, including
whether or not you are eligible for the credit, please leave me a comment! Be
sure to forward this to all your homeowner friends so they can take advantage
of this once-in-a-lifetime opportunity.

Where are we today in Residential Real Estate?

Existing home sales were up 10% in October over last year’s
sales pace.  Why?  One of the main reasons is that prices are
down.   In many price points and
locations, prices are slowly increasing but in others, they continue to
fall.  In a recent poll by Zillow, home owners responded to a question
asking about their property values…here are their answers:  26% thought their property values went
up;  25% thought their value had remained
unchanged and 49% thought their values went down.  Well, the truth of the matter is that 72% of
the country has lost value in their homes this year and only 18% had seen an
increase.  Unfortunately, as we all know,
perception isn’t reality – too bad for us. 
Why are we having value issues? 
As we have discussed in the past, a lot of the problems stem from the
Home Valuation Code of Conduct and the ramifications it has had on our
appraisals lately – let’s hope this gets reversed soon!  Another reason for the increase in sales is
interest rates.  Rates are at historic
lows and have been for several months. And lastly, the first time home buyer tax credit and the subsequent
has generated additional sales. 
The extension of the credit also includes a component where home owners
who have been in their principal residence greater than 5 years can sell and
move into another principal residence and receive a $6,500 tax credit under
certain conditions.  See the link above
for additional details.

So, you ask, what does this mean to me?  Well, you need to get busy finding first time
buyers and move up buyers who have been in their homes for more than 5 years!  You need to become proactive and seek out
people wanting to be educated on the market and take advantage of the
opportunity available to them.  Why?  If you aren’t being proactive and you are
sitting back waiting for people to come to you or you are lucky enough to be in
the situation where you are taking orders – like many did from 2003-2006 – you
will be out of business in 2011!  History
repeats itself as we all know.  Don’t sit
back and wait for it to happen – make it happen.  Get it? 
Got it?  Good!

Now, go sell something!