UPDATE: The 2009 Stimulus package includes an updated version of the First Time Home Buyer Credit. CLICK HERE for more information.
$7500 Tax Credit for First Time Home Buyers
The Feds have passed a new law enabling first time home buyers to benefit from a $7500 tax credit when they purchase a home. (The Housing and Economic Recovery Act of 2008 – HR3221). This is an excellent incentive to encourage some movement into the housing market. With interest rates low and large inventories of homes, there are some fantastic opportunities out there.
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The tax credit is available for first-time home buyers only
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The maximum credit amount is $7,500
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The credit is available for homes purchased on or after April 9, 2008 and before
July 1, 2009 -
Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit
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The tax credit works like an interest-free loan and must be repaid over a 15-year period
This has the potential of positively affecting the whole Grand Rapids market. As these 1st time buyers move in, the previous owners will move up. This is a smart move by the government in an attempt to stabilize the economy by bringing down some of the housing inventory levels. Property values have dropped dramatically in the last couple of years. And now with sellers getting very competitive by lowering their asking price, fixing up the house, offering Home Warranties… it is a good time to take advantage of this tax credit.
Here is a good FAQ from the National Association of Realtors.
UPDATE 2/11/2009: $15,000 Home Buyers Tax Credit
Another point is that if you do not make money when you sell with the $7500 you do not have to pay it back.
[...] on a cul-de-sac in a safe, quiet neghborhood. Eligible first time home buyers may qualify for the $7500 tax credit. It is also close to the major highways so commuting is easy, PLUS, it is a short hop to downtown [...]
[...] a good savings to qualified buyers and if you are a first time buyer that qualifies, there is a $7500 tax credit if you purchase before June 2009. The tax free benefits begin to phase out this year, meaning that [...]
[...] appliances, amenities and very reasonable association fees. If you take that lower price, use the $7500 tax credit (if you are a first time buyer) and factor in the low interest rates, you will have yourself quite [...]
[...] bill now underway has a $15,000 tax credit for home buyers. This enhances the recent $7500 First Time Home Buyer Tax Credit in a few different ways. Yesterday, Feb 10th, the Senate passed this bill however it hasn’t [...]
[...] Homebuyer Tax Credit – Grand Rapids Real Estate Market Update 14 02 2009 So what was a $7500 “First Time” home buyer tax credit, then it was reported to be a $15,000 home buyer tax credit, was changed at the last minute to an [...]
If I receive non taxable income can I receive first time homebuyer credit?
According to the first time hope buyer credit info on publication 17 it states that you had to have purchased you home after April 8 2009. Whats the deal with that? Why April? Why not January 1, 2008? I bought my house on March 6th but could not move in Until April 15th because the house was not inhabitable. I assume i do not qualify.