Mic Ortega

Home sales surged for the second month in a row in October, climbing to the highest level in 2 1/2 years as first-time buyers rushed to take advantage of an expiring tax credit.

Home sales nationwide are now up nearly 36 percent from their bottom in January, data Monday showed, though they are still 16 percent below the peak in autumn 2005. At the current sales pace, there is only a 7-month supply of homes on the market and in some areas there are bidding wars. 

Without adjusting for seasonal factors, sales were up 21 percent from a year earlier and were up in all four regions of the country. The gains were led a 26 percent increase in the Midwest. Sales were up 25 percent in the Northeast, 23 percent in the South and 10 percent in the West.

The housing recovery is being driven by lower prices combined with federal programs to lower mortgage rates and bring more buyers into the market. The median sales price was $173,100, down 7 percent from a year earlier and off roughly 2 percent from September

Mic Ortega

Nearly 1,000 real estate agents cast their votes on which do-it-yourself home improvement projects will help sellers get top dollar.

HomeGain.com’s 2009 Top 12 Home Improvements Survey Results showed that cleaning and de-cluttering was the easiest and most cost-effective way to make your home more appleaing to buyers. For as little as $100-$200, sellers could see as much as a 10x increase in their sale price.

Stacie Staub

Tax Credit for Homebuyers

First-Time Homebuyers (FTHBs): First-time homebuyers (that is, people who have not owned a home within the last three years) may be eligible for the tax credit. The credit for FTHBs is 10% of the purchase price of the home, with a maximum available credit of $8,000.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

Current Owners: The tax credit program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years.

Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.

What are the New Deadlines?

In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.

Tax Credit Versus Tax Deduction

It’s important to remember that the tax credit is just that… a tax credit. The benefit of a tax credit is that it’s a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a first-time homebuyer were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.

Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!

Higher Income Caps

The amount of income someone can earn and qualify for the full amount of the credit has been increased.

Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible

Joint filers who earn up to  $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.

Maximum Purchase Price

Qualifying buyers may purchase a property with a maximum sale price of $800,000.

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Remember, the new tax credit program includes a number of details and qualifications. For more information or answers to specific questions, please call or email me today.

In addition, you may be able to benefit from additional housing related provisions, including the following:

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Tax Incentives to Spur Energy Savings and Green Jobs

This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.

Landmark Energy Savings

This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.

Repairing Public Housing and Making Key Energy Efficiency Retrofits To HUD-Assisted Housing

This provision provides a total of $6.3 Billion for increasing energy efficiency in federally supported housing programs. Specifically, it establishes a new program to upgrade HUD-sponsored low-income housing (for elderly, disabled, and Section 8 ) to increase energy efficiency, including new insulation, windows, and frames.

Expanding Housing Assistance

This provision increases support for several critical housing programs. It includes $2 Billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties.

If you have questions about these credits, or if you would like to talk about how you might get started on listing or finding your home, please contact us, we would love to help!

Mark White

The new Denver Zoning Code is almost a done deal.  The City Council has voted on a timeline, the public hearings are over and the new Zoning Code Draft # 3 is available for your examination and comment HERE.  There are TWO more PUBLIC LISTENING SESSIONS scheduled in November and it won’t be a surprise if that’s not all she wrote.  All of the momentum is in place to get the new code in place in early 2010. 

It’s not in anybody’s interest to delay this process any further.  Uncertainty is the enemy of investment and development, and the enemy of your home’s valuation.  It’s gonna get done and if you want to have a say…now’s the time. 

Take a look at the new draft.  City planners appear to have taken into account many public comments and made positive changes to the new draft. 

If you don’t get involved now you don’t get to b**ch later.  And we all know how much the people who pay no attention during the process like to b**ch about the result!

John Skrabec

If you have completed or know of a great renovation project in the Greater Highlands area, contact LIVE Broker Associate Jana Miller at jana@liveurbandenver.com to suggest it be featured as the “Renovation Spotlight”. The new segment will feature before and after photos of projects big and small, including outdoor projects in summer months. Additional photos will be published on the Tribune’s website at http://www.northdenvertribune.com.

Renovation Spotlight is especially interested in affordable yet unique homeowner-based projects (DIY!), all things green and sustainable, drop dead architecture, historic restorations, and all-around eye-popping design. Submissions from contractors, architects and designers welcome, but ‘fix and flips’ receive less consideration than homeowner-driven projects. Participants must be willing to describe their approximate budget.

Mic Ortega

“What do you mean we aren’t closing on time?”  A phrase that almost never was uttered in a real estate office has now become more of a standard, flying from a cell phone held out far enough to preserve an ear drum.  Talking to agents throughout the industry, it is absolutely amazing now how many closings are in fact not closing on time.  And while it can cause enough stress to send you straight to a beach in Mexico, as long as expectations are properly handled, closings are still happening every day at a surprising rate.

This phenomenon of not closing on time began popping up earlier this summer at a more noticeable rate.  It was about this time that the Real Estate industry started handing down stricter and many would argue, ridiculous new regulations.  The intent of these regulations could be viewed as reasonable, but mostly they have resulted in much more gray hair for the industry and a much larger amount of buyers earnest money at risk.

Now that fewer and fewer closings are happening on time, and the industry is realizing these regulations aren’t changing anytime soon, those that are able to adapt have been able to find ways to close on homes, close to on time, or near a time frame that all parties are expecting.  As our Managing Broker, Mark White, keeps reminding us, “a closing date is a goal for closing.  This is a sliding time frame and as long as all parties realize that it may have to be adjusted and are expecting it, there is no reason these delays should keep a transaction from closing.”  By no means are we saying that delayed closings are acceptable.   But it is now realty that due to problems ranging from slow and poor appraisals, non-disclosure by the lending industry, etc., some closings aren’t going to happen when we want. 

For these reasons, it is very important for all parties, agents, buyers and sellers to be in constant contact with eachother and all lenders involved.  There is nothing worse than a call from a lender at the last minute saying they have to re-disclose a good faith estimate and the moving van in  your driveway may be sitting there for awhile, on your dime.   And while it can seem like a daunting task to actually buy or sell a home now, don’t lose hope.  It looks like the First Time Tax Credit might be extended, there are incredible deals in every aspect of the market and believe it or not, we need more homes for the buyers out there!  Just remember as you start the exciting home buying or selling process, dates may shift and stress levels may rise.  But with good communication and expectations laid out for all parties, successful closings are very realistic, continue to happen at an exciting clip, and you can be one step closer to owning your new home.

Mic Ortega

Great news from Washington today.  The House of Representatives has signed off on a bill that was approved by Senate on Monday that would extend the First Time Buyers Tax Credit to next summer.  There is still work to be done, but a bill should reach President Obamas desk for his signature later this week.

Under the proposal, individuals with income up to $125,000 a year (existing bill is $75,000 a year) and couples earning up to $225,000 a year (existing bill is $125,000 a year) would be eligible for the credit.  The extension would cover homes under contract by April 30^th and closed by June 30^th, 2010. 

 The tax credit will expand to non first time home buyers as well. There are a few tweaks for non –first time home buyers- the credit is reduced from $8,000 to $6,500, and they must have owned a home for a least five of the past eight years. Remember- this is NOT final ,and even if it is approved , it could contain further changes.

This could be great news for a housing market that saw a decline in sales for the first time in many months with the threat of the tax credit deadline looming.  Stay tuned for further updates this week.