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BY ANDREA MARTONE
NEWJERSEYNEWSROOM.COM
While time is growing short to take advantage of the federal government's home buyer tax credit plan, there is still an opportunity to find the perfect home!
When the program was renewed in late 2009, it was expanded to include repeat home buyers as well as to the original group, first time home buyers. While there are some slight differences between the two plans, they both provide a great opportunity to those in the market for a new home. To qualify, a binding sales contract must be signed on or before April 30, 2010
First-Time and Repeat Home Buyers
The maximum benefit of first-time homebuyers is $8,000. The maximum benefit for current homeowners is $6,500. These have been great incentives for those on the fence about making a real estate purchase.
One person who decided to take advantage of the tax credit is Diana Arteaga, a first-time home buyer who works in East Hanover.
Artega moved from Lake Parsippany to a two-bedroom ranch home in Lake Hiawatha. The home-buyer tax credit did play into her decision to take the real estate purchase plunge.
It's a buyer's market right now and I got the best of both worlds," Artega said. "A good price on a house AND a nice tax credit which I will use towards my new home."
Artega closed on her new home in October of 2009.
The Home Buyer Tax Credit Fine Print
Both the first-time home buyer and the repeat home buyer tax credit have residency requirements and must be at least 18 years of age, as well as be a United States citizen. There are also income limits imposed on this program. A single person may not have an income higher than $125,000 or $225,000 for married couples. If a couple's modified adjust gross income does exceed $245,000, the couple can qualify for a reduced credit. The same holds true for a single individual with an adjusted gross income less than $145,000.
An important part of the program is the "repay" rule. Once a taxpayer qualifies for the credit, it does not need to be paid back as long as the home remains the principal residence for 36 months after the purchase date. There are, however, exceptions to this rule. For example, homes purchased from a relative, received as a gift or part of an inheritance do not qualify. Homes located outside the United States also do not qualify for the tax credit. Also, the credit is reduced to 10 percent of the purchase price if the home price is less than $80,000. If the home has a purchase price of more than $800,000, the tax credit does not apply.
There is about one month left to take advantage of the program. A contract must be signed by April 30, 2010 and the closing must happen by June 30, 2010.
Andrea Martone is a Morris County Re-Max Realtor. She can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it ; 973-886-2626
A lot of people who can buy are actually buying becasue of it. I remember another article on CNN which said 400,000 of 1 million home buyers made a purchasing decision because of it in 2009. Not to mention that this credit is so much better than the first credit that was in place in 2008.
One thing though I am noticing is that "repeat home buyers" are not necessarily moving because of it, which leads me to believe that sometimes moving is about having a reason to move besides money.
In NAR's 2009 Home Buyer Profile, of those buyers surveyed, the number one reason in making a decision to buy a home is the good ole American Dream or as they put it: the desire to be a homeowner. You can't beat that type of incentive, credit or not credit.
http://www.fischerandfrichtel.com/blog/index.php/2010/03/home-buyer-tax-credit-benefits-buyers-in-the-luxury-real-estate-market/