First-time homebuyers can get a federal tax break of up to $8,000, but not for long.
‘As that deadline creeps up, I’ve gotten much busier showing houses,? said local realtor Tim Winters, Independent Brokerage Network.
The Nov. 30 deadline does not leave much time, especially with all the paperwork, Winters said.
‘People are a little bit nervous, but they are definitely out there trying to move into a house by then,? he said.
Karen Wilcox of Max Broock said they sent postcards and e-mails to people about the deadline.
‘I think there are more younger couples or people who have been renting who are coming in,? she said. “I wouldn’t be able to tell you the percentage but it definitely has improved business.?
Pam Ford-Morgan of Morgan and Milzow said her 15 agents have been busy with new homebuyer sales and she is happy about that, but doesn’t see a long-term effect.
‘There’s not a big financial commitment to make, which I think needs to be made to stabilize the market,? Ford-Morgan said.
Brian Krol of Prudential feels the same way.
‘I don’t know how we’re going to pull through the downturn in the real-estate market unless the government continues programs like that,? he said. ‘What they really need to do is help some of the people that have made their payments that have maintained good credit. There are no programs or very few programs to help them reestablish fair market value for their homes and in some cases those are the people that are upside down on their homes and they really have nowhere to go.?
Ford-Morgan said it’s a ‘double edged sword.?
‘I also have a lot of empathy for people that see a train wreck ahead that have had good equity in their houses, had good employment, but because of economic downturn are struggling,? she said. ‘I’d rather see those monies put in a different direction.?
According to National Association of Realtors, income levels of $75,000 or less for single taxpayers, $150,000 for married taxpayers are eligible for maximum tax credit. Single taxpayers with $75,000-$95,000, and married taxpayers between $150,000-$170,000 are eligible for partial tax credit.
The credit does not have to be repaid if the owner occupies the house for three years or more. However, if the property is sold during the three-year period, the credit will be recouped on the sale.
Michelle Phaup of Clarkston Realty said she heard similar complaints about only helping first time homebuyers
‘Having that incentive certainly has brought more people out to buy houses,? Phaup said who recently sold a house to first time homebuyer Ashley Swartz.
Phaup said on top of the $8,000 tax grant, Swartz also qualified for Oakland County’s Homebuyer Program for Vacant Foreclosed Properties.
‘Their incentive was to make their area better and try to uphold the value, so not everyone across the board is dropping so drastically,? said Phaup. ‘That’s not for first-time home buyers only.?
According to the program, the buyer gets a mortgage for 51 percent and then 49 percent of the purchase and rehabilitation cost is financed by Oakland County.
Swartz’s advice to new homebuyers is ‘to be patient and never give up.?
‘I’m so excited to have my own home and my own yard, it’s officially mine,? she said. ‘I don’t have to pay to not get anything in return.?
For more information on the first time home buyer tax credit check out www.federalhousingtaxcredit.com