Federal Home Buyer Tax Credit Extended and Expanded

San Mateo Home Buyers Get Window of Opportunity

A window of opportunity for San Mateo County home buyers has reopened and that’s especially important for those buyers who have been sitting on the sidelines. The good news is the President has signed H.R. 3548 – The Worker, Homeownership, and Business Assistance Act of 2009 extending the $8,000 Home Buyer Tax Credit.

Details of the Federal Home Buyer Tax Credit Extension

Here are some of the details:

• EXTENDED The $8,000 federal home buyer tax credit is available to San Mateo County first time home buyers who haven’t owned a primary residence in the past three years (Or $4,000 to married buyers filing separately).
  
• NEW A $6,500 tax credit is available to current San Mateo County home owners who have lived in their primary residence for 5 of the last 8 years. (Or $3,200 for married buyers filing separately).
  
• INCOME LIMITS INCREASED The Federal Home Buyer Tax Credit is available ONLY to buyers with a maximum adjusted gross income of $125,000 (for single purchasers) or $225,000 (for purchasers filing jointly). The credit is phased out for incomes over these amounts. That means you must document your income should the IRS challenge your application for the credit and tax return.
  
• CHANGED The federal income tax credit for home buyers now expires on April 30th, 2010. That means your San Mateo County home must be in contract by April 30th and will need to close by July 1, 2010. That deadline may jeopardize many San Mateo short sales because of their lengthy processing time!
  
• MAXIMUM PRICE CAPPED The cost of your San Mateo County home must be less than $800,000. That means the most affordable areas of San Mateo County where most home buyers get conventional Fannie Mae or FHA financing are prime targets for San Mateo first time buyers who qualify.
  
• CREDIT, NOT TAX DEDUCTION It’s a CREDIT. That means, if the home buyer owes the IRS zero, they will get a check for $8,000 (or $6,500) from the IRS. All qualified first time buyers get $8,000 whether they pay taxes or not – thanks to Uncle Sam.
  
• MILITARY BENEFITS TOO There is a special extension for any qualified extended duty armed forces (military, foreign services, intelligence) serving out of the Country. If a person is out of the Country on official government duty for at least 90 days during the period after December 31st, 2008, and before May 1st, 2010 – they or their spouse will be eligible for the tax credit extended until the same dates (in Contract on or before April 30th, close on or before June 30th) of the year 2011. That means our service members get some help this time around.
  

What Does the Federal Home Buyer Tax Credit Extension Mean to San Mateo County Home Buyers?

The pace of sale for the most affordable homes in San Mateo County will probably increase. A combination of the extended $8,000 tax credit and the continuation of the $729,750 loan limit for conventional Fannie Mae financing and FHA financing will put homes priced under $730,000 in even greater demand. Currently, the inventory of highly affordable San Mateo County homes is in short supply and we expect the supply to decline further immediately after the holiday season. It’s likely that the spring buying season kicks off earlier in 2010 than in years past. The market is changing quickly as buyer “mood” picks up!

Considering Buying a Home in San Mateo County?

If you’re considering buying a home in San Mateo County and would like to learn more about the home buying process, check out our Home Buyer Education Series Schedule for one of our upcoming webinars and live classes.

Rather Get Started Now?

Check out our Buyer Representation page. If you like the way we work, call us at (650) 655-2500 or email us at info[@]RayChelRealtyGroup.com to schedule a no obligation consultation. We’ll help you lay out a game plan to buy right.

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