Tax Incentives for Home Buyers Extended Up To April 2010-2011
Prospective first-time home buyers welcome the new legislation recently signed by President Barack Obama which gives an extension on tax incentive deadline up to April of 2010 for home buyers and around April of 2011 for qualified military personnel.
With the economy right now, anything that would make the budget stretch a little bit more would be highly appreciated. The deadline was supposed to end just at the end of the month. Those that were saving up for that big day of buying their own Sedalia dream house were given more time to reach their goal.
The good thing about it is that it was not only extended but expanded as well. First-time home buyers would still be able to get tax credit of $8,000 max. Those qualifying existing homeowners will be able to enjoy a new tax credit of up to $6,500 if they would buy a new house or build one on or before April 30, 2010.
However, this new house should be their primary residential house as second homes or vacation houses do not qualify for the tax credit and they can only avail of this credit if they have owned their existing residential house for five consecutive years over the duration of the last eight years.
People who are earning $125,000 a year and those couples with $225,000 annually are eligible to take advantage of this tax incentive. The new legislation doubled the current income limits. Buyers should ink their contracts by the end of April 2010 to be able to enjoy this tax incentive.
Basically, this is a win-win situation for new home buyers and the housing market but not limited to them. Those businesses that are closely related to real estate such as Home Improvement industry would be twice as active because of this extended and expanded legislation. New homes would mean additional paint jobs, wallpaper installation, etc.
Many are hopeful that this extension of the tax incentives would encourage more first-time home buyers in purchasing properties and that would really put a positive effect on the real estate industry. With the holidays coming in, less people are thinking of putting their money on buying a house and this extended/expanded tax incentive deadline would generate interest again for consumers in buying a home. More analysts are thinking that the real estate buzz would go up before the year ends and will continue up to the early part of next year.
It is indeed a great time to buy a new home and take advantage of the new tax incentive law. Even the National Association of Realtors positively thinks that around 2 million people will use the tax credit this year. In the past, most Americans would not have been able to buy new homes without the help of the tax incentive legislation.
If you are planning to buy a house, this would be the perfect time to do it unless you are looking for properties in expensive locales because the tax incentive has a cap on the purchase price of $800,000 but then again, if you can afford to buy a new house in expensive areas, I doubt if you are interested at all with the tax incentive.
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