Real Estate Information

This is the most succinct language regarding the $8,000 Tax Credit that I've found.  Please call me if you have any questions, or know anyone that would benefit from this tax credit!

Expanded Tax Credit for First-Time Homebuyers

On February 25, 2009 the U.S. Department of the Treasury announced a tax credit up to $8,000 to qualifying taxpayers under the Administration’s Recovery, Stability, Affordability Plans. The Treasury’s press release that nearly one out of every two homebuyers were buying for the first time. This program will make it easier for these first-time buyers to enter the housing market this year.

“The expansion of the first-time home buyer tax break as part of the President’s recovery agenda gives money to taxpayers when they need it most, while also targeting an important group of buyers. We view our economic recovery plan, our financial stability plan and now this homeowner affordability plan as three legs of the same stool—an integrated whole that represents our immediate response to the current crisis. We remain committed to swift, efficient and effective implementation of all of these components”….Treasury Secretary Tim Geithner

The Internal Revenue Service has posted on IRS.gov a revised version of form 5405, First-time Homebuyer Credit to incorporate provisions from the American Recovery Act. Under this new act, qualifying taxpayers who buy a home this year (starting January 1, 2009) but before December 1, 2009 can claim up to $8,000, or $4,000 for married individuals filing separately, on either their 2008 or 2009 tax returns. UNLIKE THE PRIOR FIRSTTIME HOMEBUYER CREDIT, THIS IS MONEY INDIVIDUALS DO NOT NEED TO PAY BACK.egal, accounting or other expert advice should always be obtained from a competent professional.

As always there are certain limitations which must be followed including:

• Only applies to the principal residence as defined and is identical to the one used to determine whether you may qualify for the $250/$500,000 capital gain exclusion

• No repayment of the tax credit unless the homeowner does not occupy the property for a minimum of 3 years

• A first-time home buyer is defined as someone who hasn’t owned as principal residence for three years prior to the purchase

• Income limits are $75,000 for individuals and $150,000 for married couples

• Parent co-signers are allowed

• The tax credit is equal to 10 percent of the home’s purchase up to a maximum of $8,000

• New or resale homes qualify including single family detached homes, attached homes including condominiums and town-homes, manufactured homes (mobile homes) and houseboats

• Tax credit amount is reduced to zero for taxpayers with modified adjusted gross income (MAGI) of more than $95,000 (single) or $170,000 (married) and is reduced proportionally for taxpayers with MAGI’s between these amounts (When determining MAGI, the IRS defines MAGI as “a taxpayer must first determine adjusted gross income (AGI). AGI is total income for a year minus certain deductions (adjustments), but before itemized deductions from Schedule A or personal exemptions are subtracted…AGI includes all forms of income including wages, salaries, interest income, dividends and capital gains.)

• If MAGI is above the limit, partial credits of less than $8,000 are available for some taxpayers whose MAGI exceeds the phase-out limits

• This tax credit is refundable meaning that the home-buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. This involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.

• If a taxpayer has already filed to receive the old $7,500 tax credit on the 2008 tax return, taxpayer may amend the 2008 tax return with a 1040X form.

• For purposes of this tax credit, a principal residence that is constructed by the homeowner is treated by the tax code as having been purchased on the date the owner first occupies the home…being between January 1 and December 1,2009.

• The tax credit is a dollar for dollar reduction in what the taxpayer owes… meaning a taxpayer who owes $8,000 in income taxes and who receives a $8,000 tax credit would owe nothing to the IRS. It does not act as a tax deduction.

• For a home purchase in 2009, the law allows taxpayers to choose (elect) to treat the qualified home purchases in 2008 (occurred on December 31, 2008) giving the taxpayer certainty by knowing the 2008 MAGI thus helping the buyer know whether the income limit will reduce their credit amount.

Remember, the difference between this tax credit and the Act Congress enacted in July of 2008 is that this tax credit does not have to be repaid. The previous tax credit was essentially an interest-free loan while this tax credit is a true tax credit!

Well, I've said it before, Colorado is ahead of the curve in terms of economic recovery.  Today's Business Journal echos this sentiment:

CSU, CU Economists: Colorado’s Recovery Could Start as Early as Summer

Excerpted from The Denver Business Journal - Wednesday, January 21, 2009

Colorado went through a bad economic year in 2008 and can expect more of the same this year, but there are signs that a recovery could start as soon as summer, a pair of Colorado’s top university business economists agreed Wednesday.

While calling 2008 “a horrific year,” Martin Shields, regional economist at Colorado State University, said that “things really weren’t so bad in Colorado” as they were across the nation.

Speaking at the South Metro Denver Chamber of Commerce’s annual Economic Forecast Breakfast at the Hyatt Regency DTC, Shields noted that Colorado was one a handful of states that actually created slightly more jobs than it lost last year, although the pace of job growth slowed.

He also said that Colorado’s housing market, although overbuilt, had “no real-estate bubble to pop” as compared with other states like California and Florida, so its economy has been hurt less by deflation in housing prices.

And while he predicted 2009 “will be a rough year” in the Centennial State, with the loss of an estimated 3,400 jobs, “we expect us to begin a recovery by mid-summer.”

Richard Wobbekind. associate dean in the Leeds School of Business at the University of Colorado at Boulder, who also addressed the breakfast, said he agreed with much of Shields’ assessment, although he added there is great uncertainty about when a recovery may begin.

“We’re talking about an economy that’s stuck in the mud,” Wobbekind said. “The best-case scenario is that we start to pull out of this by mid-summer,” with the third or fourth quarter of the year a more likely starting point, he said.

To read the full article, please click here:  http://denver.bizjournals.com/denver/stories/2009/01/19/daily20.html?surround=etf

Keep up the good work, Colorado! 

Jan

I am very proud to share my new listing, just on the market today!   16111 E. Belleview Drive is a beautifully updated 3 bed, 2.5 bathroom home in Piney Creek Overlook.  See the virtual tour here:

Call me if you'd like a personal tour.  This home is an amazing value, and it won't last long!

Jan

Information about first time home buyer tax credits as amended by the American Recovery and Reinvestment Act of 2009 (HR 1).

Please consult your tax advisor / accountant to determine whether you are eligible for this tax credit before making any decisions or changes to your tax status.  This website is for information only and should be verified by a tax professional.

 The 3 changes to the first-time home buyers tax credit program include: 

1. The Tax Credit is for home buyers (either spouse if filing jointly) who have NOT owned a principle residence during the three-year period prior to the purchase.  Ownership of vacation property or rental property does not disqualify home buyers from this program.
2. The maximum credit is $8,000 or 10% of the home purchase, whichever is less.
3. The credit is available for homes purchased on or after January 1, 2009 and before December 31, 2009. 
4. To qualify for the full tax credit, married couples' modified adjusted gross income (MAGI) should be under $150,000 and single filers' MAGI should be less than $75,000. Partial tax credits may be available for married couples with MAGI incomes of over $150,000 but under $170,000 and single filers with incomes over $75,000 but under $95,000.  If married couples who qualify for the first-time tax credit file separately, they would both claim 5% of the home purchase or $4,000 each (whichever is less) on their tax returns.
5. Home buyers who qualify for this program, but who do not intend to purchase a home till the end of 2009, may elect to alter their tax withholdings (up to the amount of the of the tax credit) in order to save up money for a down payment.  However, if the purchase of the home does not occur, the taxes must be repaid to the IRS.
6. There is no recapture or repayment clause IF the home is owned for at least 36 months.
7. The effective date of purchase for new construction (even if buyer owns title to the lot) is the date the owner first occupies the house.  So even if construction began in 2008, as long as the home and buyers qualify for the tax credit, they will be eligible if they take possession any time during 2009.   However, new construction bought from the builder is only eligible if the settlement date (closing) takes place between January 1, 2009 and December 31, 2009.
8. The law allows taxpayers to elect to treat qualified 2009 purchases as a 2008 purchase so that they can receive the tax credit on their 2008 tax returns.
9. The full amount of the eligible tax credit is refunded to the buyer, regardless of whether the buyer has paid an equivalent amount in taxes. 
   
    The American Recovery and Reinvestment Act of 2009

Source: newquestcity.com

Several large U.S. banks — including JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. — said Friday they will halt home foreclosures while the federal government works out a plan to stabilize the nation’s banking industry.

The White House is considering a plan that would use federal funds to buy at-risk mortgages and refinance them, thereby making them more affordable to the homeowner.

Details:

• JPMorgan Chase said Friday its moratorium would remain in effect through March 6.

“We will not add to the foreclosure process any new owner-occupied residential loans that are owned and serviced by J.P. Morgan Chase,” CEO Jamie Dimon said in a letter Thursday to Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee.

“We believe three weeks is adequate time for the Treasury to announce — and for us to implement — a new plan,” Dimon wrote.

New York-based Chase (NYSE: JPM) implemented a similar foreclosure freeze for 90 days beginning on Oct. 31.

“We stand ready to work with you to put the appropriate processes in place, including a national modification standard, to reduce the incidence of foreclosure and to encourage long-term, sustainable home mortgages,” Dimon wrote in the letter to Frank.

JPMorgan Chase is the parent company of Chase bank, the fifth-largest bank by deposits in Colorado, with 87 branches in the state as of June.

Washington Mutual Inc., one of the nation’s most active mortgage lenders, merged into Chase in September. WaMu had 40 offices in Colorado.

• Bank of America also will suspend foreclosures until March 6, but the date remains flexible, said spokeswoman Jumana Bauwens.

Charlotte, N.C.-based BofA (NYSE: BAC) bought Countrywide Financial Corp. in July in a $2.5 billion that made the bank the country’s largest mortgage lender.

• Citigroup will suspend foreclosures until March 12, the Associated Press reported.

The foreclosure suspension applies to owner-occupied homes on which New York-based Citi (NYSE: C) owns the first mortgage, and to mortgages where the bank has reached an understanding with the homeowner.

This report includes contributions from the Atlanta Business Chronicle, Business First of Louisville and Business Courier of Cincinnati, sister newspapers of the Denver Business Journal.

The times they are a changing.......  LOANS

You cannot have more than one FHA loan now.  Used to be good for buying rental properties, but harder to get now.  Call me if you have any questions.

PMI or Private mortgage insurance has gone up dramatically recently.  Not only to they get bailed out, they are charging us to bail them out again.  ugh..... congress who mandated the looser qualifying guidelines and those who lent the money.  By the way mortage insuance is now tax deductible like your interest.

Probably the best thing to do if you are not putting 20% down is to do a first mortgage  and a second mortgage.  This usually requires 10% down.

FHA loans go up to $368,000 now in Arapahoe County and you can put down as little as 3.5% . These are pretty good loans now.

There still is good money out there to purchase residential and investment properties. Now is the time.  Denver is picking up.

I am pleased to be able to show you my newest listing!  It's a 3 bed, 2.5 bath paired home in Southcreek.  The home is in perfect condition, and is a wonderful value at $179,900.  Please visit http://www.Obeo.com/515071 to learn more about it!

 Please let me know if you, or your friends or relatives may be interested in this wonderful home!  I'd love to show it to you!

  Jan

The final public meeting for the Parker Road Corridor Study, Hampden to E-470 will be held on Thursday, January 15th.  It will be at the Shalom Park Retirement Community at 14800 E. Belleview Drive, Aurora.  There will be an open house from 5:00 - 7:30 PM, with a brief presentation at 6:00 PM. 

The draft corridor study recommendations and the draft Access Control Plan will be presented.  Please see the attached newsletter for a project update and directions to the meeting.

Hope to see you all there.

 Jan

January 2, 2009

Happy New Year to Everyone!  Please look at the newsletters that are posted for Piney Creek, The Hills at Piney Creek, the Highlands at Piney Creek and Siena.  The information on the MARKET for the past year is very, very interesting.  I am hoping, (as all of us are that live here) that 2009 will be a GREAT year.  I have many reasons to believe it will be!  It will probably start out slow, but the momentum is definitely growing!

I heard through the grapevine that the New Years Party at Al's Bistro was wonderful.  We are so lucky to have some real non-chain venues offering live music so close to us!

Have a great one everyone!

Jan