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IRS Tax Credit Extended to April 30, 2010

A new law that went into effect Nov. 6 extends the first-time homebuyer credit five months and expands the eligibility requirements for purchasers.

The Worker, Homeownership, and Business Assistance Act of 2009 extends the deadline for qualifying home purchases from Nov. 30, 2009, to April 30, 2010. Additionally, if a buyer enters into a binding contract by April 30, 2010, the buyer has until June 30, 2010, to settle on the purchase.

The maximum credit amount remains at $8,000 for a first-time homebuyer –– that is, a buyer who has not owned a primary residence during the three years up to the date of purchase.

But the new law also provides a “long-time resident” credit of up to $6,500 to others who do not qualify as “first-time homebuyers.” To qualify this way, a buyer must have owned and used the same home as a principal or primary residence for at least five consecutive years of the eight-year period ending on the date of purchase of a new home as a primary residence.

For all qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 tax returns. Taxpayers who claim the credit on their 2009 tax return will not be able to file electronically but instead will need to file a paper return.

A taxpayer who purchased a home on or before Nov. 6 and chooses to claim the credit on an original or amended 2008 return may continue to use the current version of Form 5405.

Income Limits Rise

The new law raises the income limits for people who purchase homes after Nov. 6. The full credit will be available to taxpayers with modified adjusted gross incomes (MAGI) up to $125,000, or $225,000 for joint filers. Those with MAGI between $125,000 and $145,000, or $225,000 and $245,000 for joint filers, are eligible for a reduced credit. Those with higher incomes do not qualify.

For homes purchased prior to Nov. 7, 2009, existing MAGI limits remain in place. The full credit is available to taxpayers with MAGI up to $75,000, or $150,000 for joint filers. Those with MAGI between $75,000 and $95,000, or $150,000 and $170,000 for joint filers, are eligible for a reduced credit. Those with higher incomes do not qualify.

New Requirements

Several new restrictions on purchases that occur after Nov. 6 go into effect with the new law:

Dependents are not eligible to claim the credit.
No credit is available if the purchase price of a home is more than $800,000.
A purchaser must be at least 18 years of age on the date of purchase.
For Members of the Military

Members of the Armed Forces and certain federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and still qualify for the credit. An eligible taxpayer must buy or enter into a binding contract to buy a home by April 30, 2011, and settle on the purchase by June 30, 2011.

For more details on the credit, visit the First-Time Homebuyer Credit page on IRS.gov.

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Free listings continue on 2009 KC Metro Housing Stats report

Selling a home By Owner requires help. That’s why during these hard economic times KCFSBO.com is continuing to offer FREE Listings. Get 30 days and 6 pictures listed for free. Get all the help you can. One more place to list your home won’t hurt.

The Star reported:

…the average sales price for a new home in the Kansas City area in December was $306,834, down 3 percent from December 2008, according to the Kansas City Regional Association of Realtors. The average sales price of an existing home in December was $144,789, up 9 percent from a year earlier.
The Realtors’ group also reported weaker sales activity in December. There were 193 new homes sold last month, a 9 percent drop from December 2008 and a 22 percent decrease from November 2009. There were 1,523 existing homes sold in December, down 4 percent from a year earlier and a 31 percent drop from November.
The inventory of unsold new and existing homes on the market in the metro area continued to decline. There were 14,005 homes available in December, down 11 percent from December 2008.
A hopeful sign for home builders going into 2010 was the 37 percent drop in the supply of new homes in the area compared with a year earlier. There were 2,024 new homes on the market in December compared with 3,208 in December 2008.

Get started today by clicking the FOR SALE link above.

July Housing stats are in…

Kansas City Regional Association of REALTORS® and Heartland Multiple Listing Service have released some statistics for July.

Average Sales Price

The average new home price this month ($308,161) is 2% higher than one year ago ($302,676). The largest price increase (36%) occurred in Platte County. Cass, Clay/Ray and Jackson Counties also posted increases in average sales price for new homes this month compared to July 2008. The average existing home price this month ($161,536) is almost the same from one year ago ($161,508). Wyandotte County experienced an increase in average sales price for existing homes from the same month last year. The average price for combined new and existing homes in the region this month was $174,691, which is down 1% from the average sales price of $176,788 for combined sales prices in July 2008. One county, Platte, experienced a increase in the average sales price for new & existing combined from the same month last year.

Home Sales

New home sales this month of 262 represents an 18% decrease from one year ago when there were 320 new home sales in July. However, new home sales increased for the sixth month in a row, for and increase of 4% over the past month when there were 251 new home sales, and up 85% since January. Existing home sales also increased for the sixth month in row this month and were up 3% from one year ago when there were 2,434 sales. They were also up 4% from last month’s sales of 2,420 compared to this month’s sales of 2,516 and up 134% since January. Combined home sales of existing and new homes were 2,778 for July, which is up 4% from the total of 2,671 sales from a month ago. This month’s combined total sales were up 1% from one year ago when there were 2,754 sales.

Inventory

New Home inventory continues its steady decrease again this month with 2,486 homes in inventory compared to 2,587 new homes on the market last month. The new home inventory for the region is 34% lower than it was a year ago at this time when there were 3,766 new homes on the market. Resale inventory this month of 13,932 is 1% lower compared to 14,049 one month ago. However, the existing resale inventory this month is 12% lower than it was a year ago when the resale inventory was 15,907. New & existing inventory combined was 16,418 this month compared to 16,637 last month representing a very small change in the past month. One year ago the inventory was 19,673 which represents a 17% decrease in total inventory over the past year.

Kansas City Region Supply of Homes on the Market

The Supply calculation has been modified and is now determined by taking the “Inventory” and dividing it by the “12 month average of the number of Sales.” Generally speaking, a 5-6 month supply of homes on the market equates to a “balanced” market. When the supply exceeds 6 months, the market begins to favor buyers, and when the supply is less than 5 months the market tends to favor sellers. Supply for combined new and existing homes showed an 8 month’s supply for July compared to 8.1 in June. The existing home supply dropped slightly to 7.6 months from 7.7 in June. The new homes supply in July 2009 was 11.2 months of supply compared to 11.5 in June. With these changes in supply over the last month, a buyer’s edge is still present in both the new home market and in the existing home market.