NAR Frequently Asked Questions – Homebuyer Tax Credit Changes

Homebuyer Tax Credit Changes

National Association of REALTORS® Government Affairs Division
500 New Jersey Avenue, NW, Washington DC, 20001

Here are some of the most frequently asked questions on the changes to the Homebuyer Tax Credit

Question: Existing homeowner credit: Must the new house cost more than the old house?

Answer: No. Thus, for example, individuals who move from a high cost area to a lower cost area who meet all eligibility requirements will qualify for the $6500 credit.

Question: I am an existing homeowner. On October 25, 2009, I signed a contract to purchase a new home. I have lived in my current home for more than 5 consecutive years and
am within the new income limits. I will go to settlement on November 20. If President Obama has signed the bill by the time I go to settlement, will I qualify for the new $6500 tax credit?

Answer: Yes. The existing homeowner credit goes into effect for purchases after the date of enactment (when the bill is signed). There is no reference to the date of contract for the new credit. The provision looks solely to the date of purchase, which is generally the date of settlement.

Question: I am a first time homebuyer but was not within the prior income limits at the time I entered into my contract to purchase on October 30, 2009. I will be covered,however, by the new income limits. If the new rules have been signed into law by the time I go to settlement, will I be eligible for a credit?

Answer: Yes. The new income limitations go into effect as soon as the President has signed the bill.  The income limit and other eligibility rules will look to your status as of the date of purchase, which is the settlement date. So if the new rules have been signed when you go to settlement, you should be eligible for the credit (or a portion of the credit if you’re within the phaseout range).

Question: I am an eligible existing homeowner. I have a fair amount of equity in my home. I have found a home with a nonnegotiable price of $825,000. Will I be able to use any of the $6500 tax credit?

Answer: No. The $800,000 cap on the cost of the purchased home is firm at $800,000. Any amount above $800,000 makes the home ineligible for any portion of the credit. The $800,000 is an absolute ceiling.

Question: I owned my home for 10 years, but sold it two years ago year and have been renting since. If I purchase a home, will I be eligible for the $6500 tax credit if I meet all the other eligibility tests?

Answer: Yes. Because you lived in the home for more than 5 consecutive years of the previous 8, you will qualify for the $6500 credit. For example, Say John and his wife bought a home in 2000 and lived there until 2008 when he got a divorce. Whether John has been renting or bought in the interim, he WOULD INDEED be eligible for the credit because he owned a home and occupied it as his principal residence for 5 consecutive years out of the last 8 years. The keyword here is “consecutive.” As long as he lived in that house for 5 years straight what he did since 3 years doesn’t impact eligibility.

Question: I am an eligible first time home buyer. I entered into a contract to purchase on November 1, 2009. Do I have to go to closing before December 1? How does the extension date affect me?

Answer: You do not have to close before December 1. Once the legislation has been signed, it will be as oif the Nov 30 date had never existed. Therefore, so long as the contract settles before April 30

(or July 1, worst case), the purchaser will be eligible for the credit.

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If one of our Icon Agents can help you, give us a call.  281-367-3531

Down Load the .PDF – NAR Frequently Asked Questions – Homebuyer Tax Credit Changes

Download the .PDF – NAR Issue Brief, Homebuyer Tax Credit

The Woodlands Real Estate Report

Months Supply Of “For Sale” Listing Inventory – November 3^rd, 2009

Buyers or Sellers — Who Rules According To Months Supply Of Inventory?

According to real estate economists, 6 months supply of For Sale Inventory represents a balanced market.  A higher number means it’s leaning towards a buyers market, less of course would be a sellers market.

Here’s the thing, these numbers represent big averages across The Woodlands.  Real estate is hyper local in nature. Market conditions for your specific property, in your specific neighborhood may be different that the big average you see below.  To find out, contact a Realtor Icon and have them run an up to the minute, on-target market report for you.

November 3^rd, 2009 – Months Supply Of For Sale Listing Inventory – The Woodlands TX

PRICE RANGE.  .  .  .  .  .  MONTHS SUPPLY OF LISTING INVENTORY

$000,000 – $200,000 . . . . . . . . . . . . . . . . . . . .   2.9

$200,001 – $300,000 . . . . . . . . . . . . . . . . . . . .   3.9

$300,001 – $400,000 . . . . . . . . . . . . . . . . . . . .   5.0

$400,001 – $500,000 . . . . . . . . . . . . . . . . . . . .   6.6

$500,001 – $600,000 . . . . . . . . . . . . . . . . . . . .   6.5

$600,001 – $700,000 . . . . . . . . . . . . . . . . . . . .   7.3

$700,001 – $800,000 . . . . . . . . . . . . . . . . . . . .   8.3

$800,001 – $900,000 . . . . . . . . . . . . . . . . . . . .   8.9

$900,001 – $1,000,000 . . . . . . . . . . . . . . . . . .   14.9

$1,000,001+ . . . . . . . . . . . . . . . . . . . . . . . . . .    26.1

What’s It Mean?

6 months supply represents a balanced market.  A higher number means it’s leaning towards a buyers market, less of course would be a sellers market. Things that affect salability and competitive positioning of the property include, marketing, merchandising/staging/presentation and pricing. Tweak and amplify those three factors and you’ll be one of the successful sellers attracting a qualified buyer.   Ignore one; two or three of the salability factors and the property will languish.  Before you pick a list price for your property, watch this video.

Keep in mind; while this snapshot provides a more refined picture, what is happening in your neighborhood could very well be different. (Months Supply Of For Sale Inventory is how long it would take for the current For Sale inventory to sell if no new inventory came on the market and the velocity of sales remained the same.)

Wanna keep with everything? Click the “FAN” button and Facebook will keep you in the loop.

An UnTrue Story – Effective January 15, 2010

Official “Buyer Search-MLS” Announced

In an ever evolving quest to provide it’s members with innovative tools and systems, the National Association announced the nation wide roll out of their mandatory Buyer Search-Multiple Listing Service.

The new system will provide buyers and buyers agents all the same protections, conveniences and broadcast benefits that property sellers and listing agents have enjoyed for decades.

The rules of engagement for Buyers Search-MLS will require members to adhere to the same strict Code of Conduct currently in force. Per policy and procedures with Active Listings, when working with buyers, all members must have an executed Exclusive Agency Buyers Representation Agreement and submit the Buyer Profile Data to their BS-MLS within 5 days.

Powered By Your Local Association and GWHIZ

The National Association, in concert with State and Local Associations, also announced sketchy details of their lifetime service contract with Google.

This shiny new service will be dubbed GWHIZ – Google Worldwide Home Information Zenith.

Google will provide a suite of borg like powerhouse services, including these innovative tools:

• Google Wave
• Google Docs
• Google Voice
• Google Maps/Earth
• Gmail
• Google Android
• Youtube
• Google Search
• Google Chat
• All Google tools will integrate seamlessly with Twitter, Facebook, Youtube and Wordpress.

Everyone Wins.

Like the Homes-For-Sale MLS allows prospective buyers to browse, dream, research, collaboratively locate and buy real estate, GWHIZ will allow sellers to browse and collaboratively contact registered buyers.

Service benefits include:

R E A D   T H E   R E S T   O F   T H E   S T O R Y    H E R E

Real Estate

High adventure.

Seems Slip n Slide simple.

When everything goes pitch-perfect, it’s high fives and hugs.  When it doesn’t,  BIG Uggggs and broken bones!

Buying and selling real estate can be like this…

Watch this video.

If You Want To Succeed In Real Estate

I know, selling and buying isn’t quite as WTH-Dramatic or dangerous as this stunt.  You won’t physically go “SPLAT” if you miss the mark, but,  your finances and your mental health might.

Why risk a Real Estate Face-Plant?  Give me call and I’ll make sure your next real estate transaction is as spot-on as Mr. Rocket Man here.

Cheers.

Ken Brand: 832-797-1779

Here’s What’s Happened in The Woodlands TX.

It’s normal.  We watch TV, read and surf the net.  You’d think that real estate prices everywhere have plummeted.  You might also think that real estate home prices are going lower.  In The Woodlands TX, the Average Sold Price and Median Sold Price has bounced up and down within a 10% window.  Compared to real estate markets across the country, our market is STABLE.  Prices are falling.  Steals are non existent, good values are. Steals no.  Foreclosures and Short Sales are few and far between as well.

Real estate economist think a 6 month supply of inventory equals a balanced real estate market.  Real estate agents, home owners and home sellers would crawl across cut glass to work, live and play in a real estate market like The Woodlands TX.  Remember, real estate is hyper-local.  That means what’s really relevant to you is what’s happening in your specific neighborhood.  In an earlier post, I published the Months Supply Of Inventory by price range.  You can read it HERE

The beat goes on.  These Average Days On Market are LOW.  Like I said earlier, all these statistics are big picture for The Woodlands.  Each neighborhood has it’s own story.  If you want a personalized bulls-eye report for your property, give us a call.

Wanna download the entire collection of reports (.PDF)?  Here > Real Estate Market Report Collection – The Woodlands TX / September 2009

If you want to look at all the repots, here you go.

The Woodlands Real Estate Report

Months Supply Of “For Sale” Listing Inventory – September 7th,  2009

What Can Buyers and Sellers Expect In The 4th Quarter Of 2009?

Seasonality will slow sales and reduce listing inventory in the last quarter.  You can watch the FULL story HERE.

Why?  Fewer people decide to move during fall and winter months.

If you’re a seller today, three things that affect saleability and the competitive positioning of the property are

1.  Marketing

2.  Merchandising/staging/presentation

3.  Pricing.

Tweak and amplify these factors and you’ll be one of the successful sellers attracting a qualified buyer.   Ignore one; two or three of the saleability factors and the property will languish.  Before you pick a list price for your property, watch this video.

If you’re a buyer, interest rates are at an all time low, selection is healthy and sellers are motivated.  Good luck.

Below you’ll find Months Supply Of Inventory by Price Range.  According to real estate economists, 6 months supply of For Sale Inventory represents a balanced market. Keep in mind; these numbers represent big averages across The Woodlands.  Real estate is hyper local in nature. Market conditions for your specific property, in your specific neighborhood may be different that the big average you see below.  To find out, contact a Realtor Icon and have them run an up to the minute, on-target market report for you.

September 7th, 2009 – Months Supply Of For Sale Listing Inventory – The Woodlands TX

PRICE RANGE.  .  .  .  .  .  . . .MONTHS SUPPLY OF LISTING INVENTORY

$000,000 – $200,000 . . . . . . . . . . . . . . . . . . . .   3.8

$200,001 – $300,000 . . . . . . . . . . . . . . . . . . . .   4.6

$300,001 – $400,000 . . . . . . . . . . . . . . . . . . . .   8.1

$400,001 – $500,000 . . . . . . . . . . . . . . . . . . . .   6.4

$600,001 – $700,000 . . . . . . . . . . . . . . . . . . . .   7.3

$700,001 – $800,000 . . . . . . . . . . . . . . . . . . . .  10.9

$800,001 – $900,000 . . . . . . . . . . . . . . . . . . . .   7.2

$900,001 – $1,000,000 . . . . . . . . . . . . . . . . . .   18.6

$1,000,001+ . . . . . . . . . . . . . . . . . . . . . . . . . .    28.2

Keep in mind; while this snapshot provides the big picture, what is happening in your neighborhood could very well be different.  If you’d like a detailed market analysis for your property and your neighborhood, give us a call at 281-367-3531.

Cheer friends.

PS.  Download the .PDF > Months Supply Of For Sale Real Estate Inventory – The Woodlands TX, Sept. 2009

Real Estate Market Report For The Woodlands TX – Listing Inventory and Written Sales / August-September 2009 – By Ken Brand from Ken Brand on Vimeo.

Hello Friends,

Wondering what’s going on in The Woodlands TX, real estate market? Are sales up or down? Are prices falling or stable?

It’s been an “interesting” year and compared to real estate markets across the country, we’re blessed.

Year To Date there have been 1,501 Contracts Written (all brokers combined) compared to 1,848 in 08′. That’s 18.7% less. No big deal really. We can all be thankful that our market is the opposite of all the market horror stories we hear about. Sales prices have remained stable.  General sentiment from buyers and sellers is positive.  Yeah.

In August, according the HAR Multiple Listing Service, there were 173 Contracts Written. 7.4% fewer than August 08′. For the first time in months, Listing Inventory fell below previous years inventory. Current For Sale listings = 863. Last year at this time = 880. Average Days On Market for Active Listing Inventory = 106 Days. Average Days On Market for Sold Listings in August = 71 Days.

What does all this mean?

Look at the trend lines. Seasonality is about to kick in. There will be fewer sales and fewer active listings through the end of the year.  Knowing this,  what should we do?

Sellers – Consider adjusting your price. If you have merchandising/staging things that can be done to enhance the perceived value and your competitive position, act now. Re-examine your marketing. Now is the time to take action.

Buyers – Selection is good. If you’re a 1st Time Home Buyer, time is running out on the 8K Tax Credit, get a move on. Mortgage rates are still at historic rates, which means you can buy more house for your money. No doubt, as the economy improves rates will rise and most likely home prices too. Act now, or?

Real Estate Agents – There will be fewer listing selling opportunities in the last quarter. If you’d like to keep your success steady, you’ll want to increase your personal contacts, conversations and networking. I’ll be publishing more market data in the next few days. Till then, if you need anything or have questions, give me a call: Ken Brand – 832-797-1779. Cheers.

Real Estate Market REport – The Woodlands TX, Listings Inventory & Sales – August/September 2009

View more presentations from Ken Brand.

Texas Real Estate Law = If It’s Not In Writing, It’s Just A Good Idea.  Oral Agreements Aren’t Contracts.

Why does this matter?

Sometimes, usually when a prospective buyer and a seller are separated by distance, offers to purchase are negotiated verbally and the written agreement is faxed, emailed of FedEX’d for final signatures.  If all goes well, buyer and seller sign the written agreement/Earnest Money Contract.

Where trouble jumps off is when, one of the parties, decides that they want to change the terms of the verbal agreement.

Sometimes, a better offer (written) is received  from another qualified buyer while the first offer is in transit for signatures and execution.  In these cases, until the offer is signed and executed by all parties, either party can walk away or ask to change the terms.  Nothing is final and binding until it’s in writing and signed by all parties.  Obviously, when verbal agreements go south, one of the parties is angry.  Anger and frustration is understandable, but not enforceable.

Bottom line, know that verbal agreements aren’t enforceable, time is of the essence, you gotta sign and execute the contract as quickly as possible.

Here’s an article from the Texas Association Of Realtors:

Oral contracts

A buyer submitted a written offer to a seller. Oral negotiations followed. The parties reached an agreement, orally. As the broker was preparing the contract for the parties to sign, the seller received and accepted another offer. May the first buyer claim breach of contract?

Since the contract was not signed, the statute of frauds will bar enforcement of the first agreement. It must be in writing and signed by the parties to be charged. [Note: This question addresses only the contractual claim and does not address whether the parties or broker breached any duties or made any misrepresentations.]

Q: I am the listing broker, and my client told me to telephone the prospective buyer’s agent with the seller’s counteroffer of several thousand dollars more than the offer made by the buyer. The buyer’s broker insists that the seller must make a formal counteroffer in writing or reject the buyer’s offer in writing. Does the seller have to respond in writing

A: No. A seller has no legal duty to respond to an offer in any particular way. A verbal counteroffer could expedite negotiations for the sale of property in many cases. Of course, once there is a meeting of the minds about the terms and conditions of the sale, the parties should promptly reduce the agreement to writing and sign the contract to make it a binding obligation.

A seller could respond to a buyer’s offer by using TAR form 1926, Seller’s Rejection of Offer With Invitation For Submission Of New Offer. This form would be particularly useful where the seller’s proposal contains several changes to the buyer’s offer. By using this form, the seller is free to consider other offers without having to be concerned about the withdrawal of a previous, written counteroffer.

What Else?

If there’s anything we can do to help you or answer a real estate related question, give me a buzz:  Ken Brand 832-797-1779

Cheers.

Should I Reduce My Listing Price? How Much? from Ken Brand on Vimeo.

I prepared this video for my friends with Listing Inventory and unsold properties.

Summer Is Setting.  Kids Are Back In School.  Is The Pool Of Qualified Buyers Shrinking?

3 THINGS TO CONSIDER

1. Marketing / Promotion / Advertising
2. Merchandising / Staging / Emotional Appeal
3. The Price / The Price / The Price

5 MARKET FACTORS TO CONSIDER

1. Seasonality
2. Days On Market
3. Months Supply
4. Immediate Competition
5. How Much To Reduce

CONSIDER YOUR COMPETITION
ReSale
New Homes
Amenities
Price Per Square Foot
Sales Velocity – Current Pending
Qualified Buyer Behavior

CONSIDER MONTHS SUPPLY OF INVENTORY
The Woodlands TX, August 2009
Price Range. . . . . . . . . Months Supply Of Inventory
$000,000 – $200,000 . . . . . . . . . . . . . . . . 4
$200,001 – $300,000 . . . . . . . . . . . . . . . . 5.3
$300,001 – $400,000 . . . . . . . . . . . . . . . . 6.2
$400,001 – $500,000 . . . . . . . . . . . . . . . . 9
$500,001 – $600,000 . . . . . . . . . . . . . . . . 5.6
$600,001 – $700,000 . . . . . . . . . . . . . . . 8
$700,001 – $800,000 . . . . . . . . . . . . . . 11
$800,001 – $900,000 . . . . . . . . . . . . . . 7.9
$900,001 – $1,000,000 . . . . . . . . . . . . . 18
$1,000,001+ . . . . . . . . . . . . . . . . . . . . . . 26.7

CONSIDER SOLD PRICE TO LIST PRICE %

Prudential Gary Greene, Woodlands Office = 98.2

Keller Williams Realty, Woodlands = 96.4

MLS Average (All Broker) = 95.6

Re/Max Spring/Woodlands = 95.3

Coldwell Banker United = 95

MLS Stats, Closed Sales – The Woodlands TX - July 15th to August 27th, 2009

FACTOR EVERYTHING IN AND THEN MAKE YOUR DECISION.

If you have any questions, give me a call: Ken Brand 832-797-1779

If you’d like that 2 page checklist on preparing your property for sale: Kens411@Gmail.com

I update the collection of market reports during the 1st week of every month.  You can find them HERE.