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Articles in the ‘Real Estate’ Category
Residential Real Estate Continues Downward Trend
According to Jeffrey Otteau September 2010 represented another month of continued housing decline.
Will the Federal Homebuyer Tax Credit Make a Return?
After a worse than expected falloff in home sales during the month of July, buzz about a possible revival of the federal homebuyer tax credit has begun to surface.
The National Association of Realtors (NAR) reported last week that sales of previously owned homes plummeted 27 percent in July, hitting their lowest mark in 15 years. New home sales also took a dive, dropping nearly 13 percent from June to July.
Both reports were clear indications of the frailty of the housing market post-stimulus. Although, the steep declines were actually considered a by-product of the tax credits themselves, which expired on April 30 – payback for the incentives that pulled sales forward into the spring months.
HUD Secretary Shaun Donovan said on CNN’s “State of the Union” program this weekend, “The July numbers were worse than we expected, worse than the general market expected, and we are concerned. That’s why we are taking additional steps to move forward.”
Report Fed Tax Credit Cost Government $22 Billion
The three versions of the homebuyer tax credit are expected to result in revenue losses to the federal government of about $22 billion, according to estimates from the Government Accountability Office (GAO). Looking at Internal Revenue Service (IRS) filings through July 3, homebuyers so far have claimed $23.5 billion under the housing stimulus provisions.
Governor Christie Vetoes Homebuyer Tax Credit
Citing “the unprecedented economic and fiscal difficulties” facing New Jersey, Governor Christie vetoed a state bill on July 23, 2010 designed to help jump-start New Jersey’s housing market by creating a tax credit for home purchases.
— with $75 million allocated for purchases of newly constructed homes not previously occupied and $25 million allocated for purchases of previously occupied homes.
Will New Jersey Realize the Homebuyer Tax Credit?
Do you remember the Carly Simon song “Anticipation.” That best describes the New Jersey homebuyer tax credit. For those of you who may have forgotten, the program would give homebuyers in the state a tax credit worth up to $15,000 spread over 3 years. The bill (A1678) passed the legislature with overwhelming bi-partisan support. It was on Governor Christie’s desk on June 10, 2010 where it now sits.
New Jersey One Step Closer to Real Estate Tax Credit
On May 27, 2010 the Assembly voted in favor of the bill allocating $100 million in tax credits to buyers who purchase a new or existing home in New Jersey in 2010. The bill would give individual home buyers, on a first-come first-serve basis, tax breaks up to $15,000 or 5% of the selling price of the house, whichever is less. The credit would be distributed over a 3 year period starting in 2011. There are no income limits for eligibility. The bill sets aside $75 million of the $100 million for buyers of newly constructed houses and $25 million for buyers of existing homes. It’s anticipated Governor Christie will sign the bill sometime in June 2010 with the law taking effect on or about July 1, 2010.
FHA to Reduce Seller Contribution Toward Buyer’s Closing Costs
The residential real estate industry is still waiting to see how the market will adjust after the homebuyer tax credit expired on April 30, 2010. More consumer incentives are about to be cut, this time from the Federal Housing Administration (FHA).
The FHA will reduce allowable seller concessions — the percentage sellers can take from the sales price of a home to fund closing costs — from 6% to 3%. According to an announcement by the FHA in January 2010, the current level of 6% exposes the Agency to excess risk by creating incentives for appraisers to increase the value of these homes. The change will take place in “early summer,” according to the FHA although no specific date has been set.
Seller concession affecting closing costs include fees for loan origination, attorney fees, appraisal and inspections, title search, title insurance, credit reports, and more. Down payment assistance is not included as a closing cost.
New Jersey Homebuyer Tax Credit Bill Advances
New Jersey legislation that aims to jump-start the state’s housing market with a 2010 tax credit for home purchases advanced on May 13, 2010. The measure (Assembly Bill 1678) would establish the New Jersey Homebuyer Tax Credit Program which would allow refundable tax credits of up to $15,000 or 5%, whichever is less, for homebuyers of new and previously owned homes during calendar year 2010.
Saying Goodbye to the Homebuyer Tax Credit?
Today is April 30, 2010. The clock has struck midnight. Despite speculation that Congress may extend the current $8,000 tax credit for first-time homebuyers and the $6,500 tax credit for second-time buyers, it’s come to an end. But has it? How will that termination affect the health of the housing market?
Doom and Gloom Continues to Plague Residential Real Estate
There was more disappointing news about the housing market. New-home sales fell 2.2% in February 2010 to a seasonally adjusted annual pace of 308,000, the Commerce Department reported, the lowest level since the government first started tracking data in 1963.
