Huge home tax credits promise boom home market

Published on Friday, January 15, 2010

The extended homebuyer tax credit should unleash a perfect storm of homebuyers this spring, said Conway Home Mortgage’s Rosemary O’Neil of Pembroke.

The local company is now a partner with Wells Fargo Home Mortgage, which is the second largest of all home mortgage companies.

“Last year we ended up with a rush of sales accredited to the tax credit,” said O’Neil, also the recent President of Mass. Mortgage Brokers Association.

The program has been extended until June 30 of this year and that makes it possible for homebuyers who missed the first period of the tax relief – which expired in December 2009, to gain the huge benefits.

The rules governing the billion-dollar tax break for homebuyers states that, “Buyers must find a home and sign a purchase and sales agreement by April 30, 2010 and close by June 30, 2010.”

Last year Congress extended the $8,000 tax credit only to first time buyers. But this time around the Bill reaches out to include a $6,500 credit to all buyers who have owned a home for at least five years and now want to reach out to buy again.

“It’s a two-for-one package,” explained O’Neil. “The $8,000 credit for first time buyers and also a $6,500 tax credit for other buyers who want to move up after owning for five years.”

In addition, the program has been extended to include any home purchase of up to $800,000. This move was made to accommodate buyers in higher-priced states like Massachusetts.

Senator Max Baucus, D-Montana, Chairman of the House Finance Committee, said, “We are still in a world of economic lows and we need these tax breaks to get us through the recession and back working again.”

The result of last year’s credit was that 1.4 million first time buyers used the program. The credit is now extended to individuals with adjusted gross income (AGI) of $125,000 or joint filers with AGI of up to $225,000.

Jack Conway, Chairman of Jack Conway Co., was elated that the new far-reaching program includes homes, condos, manufactured or mobile homes. “It covers the entire market of housing,” he said, “The only reservation being that it must be the principle residence of the buyer – not vacation homes.”

For those people wanting additional information O’Neil suggested a call to Conway Home Mortgage at 888-831-1181, or visiting www.federalhousingcredit.com.