RISMEDIA, September 1, 2009-Since Congress passed the American Recovery and Reinvestment Act earlier this year, many have seized the opportunity offered by the $8,000 tax credit for first-time home buyers. When you factor in today’s historically low interest rates and housing affordability with the financial incentive from the government, it’s easy to see why so many first time buyers have taken advantage of this chance to realize their dream of homeownership.
However, the ability to utilize this $8,000 tax credit will not be available to would-be homeowners much longer. To receive the tax credit, a first-time buyer must purchase and close on a principal residence before Dec. 1, 2009. Since closing on a home generally takes anywhere from 45-60 days, that leaves prospective buyers a little more than a month to take advantage of the this financial opportunity.
“It’s hard to imagine a better time than right now to be a first-time buyer,” said Jim Weichert, president and founder of Weichert, Realtors, one of the nation’s largest independently owned real estate companies. “Mortgage rates and home prices are all favorable, recent economic news is encouraging and the government is providing a large financial incentive. If I was a first-time buyer, I wouldn’t let an opportunity like this slip through my fingers.”
In addition to taking advantage of the tax credit, another reason for first-time buyers to consider making a purchase now are the recent signs of a stabilizing real estate market. Last week, the National Association of Realtors announced that home sales increased in 39 states in the second quarter of the year compared to the first. Last month, the S&P/Case-Shiller index showed an increase in the monthly value of homes for the first time in nearly three years.
Buying a home now might not only be the opportunistic thing to do but also the more practical decision. In many instances, renting can actually be more expensive than buying. By choosing a fixed-rate mortgage, individuals can lock in to a lower payment that will stay the same unlike rent which can increase yearly.
First-time buyers, as well those who haven’t owned a home in more than three years, who purchase a home by Dec. 1, may be eligible to claim all or part of the tax credit based on their income level. Congress will even allow individuals to still claim the credit as part of their 2008 tax return if they file an amended tax return. Individuals can also elect to receive the credit on their 2009 tax return. As with any tax law, individuals should check with a tax advisor to discuss any specifics regarding the use of this provision.
For more information, visit www.weichert.com.