Probably won’t happen.  The bill that the tax credit extension was attached to failed last Thursday and with the current deadline being set to expire on Wednesday, there seems to be little chance of an extension being passed.  However, the National Association of Realtors is hopeful:

(June 25, 2010)—NAR is working very closely with key Members of Congress and the Senate on a possible extension of the June 30, 2010 deadline for closing contracts eligible for the Homeowner Tax Credit. NAR is pursuing all possible options to determine what other legislation may be available for passing a June 30 extension. Each of the possible options face difficult obstacles, but NAR’s efforts to clear the way are on going. The Senate will not have any votes today, June 25, which will push the Tax Credit Extension deadline to the week of June 28, 2010. In the meantime, those impacted should proceed as if the June 30, 2010 date is binding.

Of course, this current tax credit is an extension of the previous credit which was an extension (and addition) to an even earlier tax credit from 2008.  Nevertheless, there were many people (NAR says around 180,000) that were expecting this credit and won’t be getting it.  So what do buyers in this situation do?  Stick with the current purchase without a tax credit or move on and keep looking (or wait)?

Either way, you won’t be getting $8,000 from the government and if they don’t extend this, they probably won’t do another credit in the future unless shtf (again).  If the only reason you chose the house you are currently purchasing was because of the tax credit (which you shouldn’t have done), you’ll probably want to walk away and rethink your home purchasing decision (consult your agent/lawyer regarding earnest money deposits and other liabilities you may have incurred).  However, if you were looking to purchase a home and the tax credit was just a bonus, you’ll probably be best off sticking with the home you have under contract assuming that it is still a good deal (which most will be).  The added benefit will be if they do extend the credit through September 30, 2010 (the originally proposed date) and you stay under contract and close before then (but after June 30th) you’ll still get the tax credit.  Whereas, if you jumped ship and found a different home, there is no chance you’ll get the credit.

I’ll keep watching the news blips on this and update as I get them.

UPDATE from NAR:

(June 29, 2010)—The United States House of Representatives has just passed HR 5623, the Homebuyer Assistance and Improvement Act of 2010, by a vote of 409-5. This bill extends the deadline for closing tax credit eligible transactions from June 30 to September 30, 2010. The bill moves to the Senate where the outcome is much less certain. NAR will continue to update you as the events move forward.

We’ll see if this gets passed in the Senate or not…

My brother and I have been working on a web app that creates single property websites to better market our listings. It’s still under construction, but if you’ve got some time to kill check it out and let us know what you think.

The Treasury Department released their details today regarding the Homeowner Affordability and Stability Plan.  There are a few different versions of the plan depending on the borrower’s situation.  The abbreviated version is that you need to call your lender to find out about your own personal eligibility.  However, here are some of the basic eligibility requirements (taken directly from the Treasury Department’s summary):

• Loans originated on or before January 1, 2009.
• First-lien loans on owner-occupied properties with unpaid principal balance up to $729,750. Higher limits allowed for owner-occupied properties with 2-4 units.
• All borrowers must fully document income, including signed IRS 4506-T, two most recent pay stubs, and most recent tax return, and must sign an affidavit of financial hardship.
• Property owner occupancy status will be verified through borrower credit report and other documentation; no investor-owned, vacant, or condemned properties.
• Incentives to lenders and servicers to modify at risk borrowers who have not yet missed payments when the servicer determines that the borrower is at imminent risk of default.
• Modifications can start from now until December 31, 2012; loans can be modified only once under the program.

To find out if you qualify, you’ll have to call your lender and supply them with your income, debt and asset information.  For more information about the plan itself, check out the following links from the Treasury Department:

• Modification Program Guidlines

• Summary of Guidlines

Photo Credit: woodleywonderworks via Flickr

“The plan will help up to 7 to 9 million families restructure or refinance their mortgages to avoid foreclosure.”

Don’t have enough equity to refinance or are you completely upside down in your home loan?  Or has your income changed, keeping you from qualifying for your current loan?  The government is here to help.  At least, that’s the idea.

The new Homeowner Affordability and Stability Plan will help homeowners that don’t currently qualify for standard refinancing options.  This includes people who have less than 20% equity in their home or owe more than their home is worth.  There isn’t much information out about the program yet, but they are planning on releasing more details on March 4th.  For now check out these links or give me a call at 208-631-3545.

• Homeowner Affordability and Stability Plan Fact Sheet
• Consumer Q & A
• White House Blog FAQ

*****UPDATED HERE*****

Did you know that the rate structure for your electricity usage recently changed?  Idaho Power announced last week that their residential rates increased an average of 1.61%.  However, the bigger news is that rates are now tiered and priced by usage.  If you use less than 800 kWh (kilowatt hours) your rates stay at a low 5.58 cents per kWh September through May and 5.78 cents per kWh during the summer months.  However, if you use more than 800 kWh but less than 2,000 kWh they raise to 6.2 cents and 6.59 cents respectively.  If you can hang meat in you home in the summer and bake a cake in there during the winter and use over 2,000 kWh you rates will be much higher – 7.13 cents and 8.17 cents per kWh.

This new structure may help reduce a lot of people’s energy use.  If you are close to one of the tiers, say around 850 kWh, you may start figuring out how to reduce the amount of energy you use in order to take advantage of the lower rates.

Curious about how to lower your energy usage?  Check out the tips below or contact us – we’re EcoBrokers, remember?

1. Set your thermostat down one degree and save two to three percent on your heating or cooling bill, depending on the season.
2. Turn off lights not in use.
3. Participate in an Idaho Power energy efficiency program.
4. Wash full loads of laundry and dishes, and use water and energy-saving settings.
5. Use plug strips for computers and video equipment and shut off when not in use.
6. Buy compact fluorescent light (CFL) bulbs for light fixtures you use more than two hours a day. They use 75 percent less energy!
7. Weather-strip windows and doors.
8. Regularly clean or replace the air filter in your furnace.

The Wall Street Journal is reporting that the $15,000 proposed tax credit was kicked out of the stimulus package in exchange for a an $8,000 tax credit for first-time home buyers that does not require repayment.  The credit will also be extended through the end of August December 1, 2009, but will only be available for those who have not already taken advantage of the $7,500 tax credit.  Remember, that means closing on the home by December 1st, not just deciding to buy by then, so if you’re interested – get on it.

Again, this is not official yet, but I’ll keep you updated.  Find the official press release here.  The IRS has not updated their website yet, but I’ll update this post when they do, so check back.

Photo Credit:  alykat via Flickr

Some of you may have heard about the $7,500 Tax Credit that is being offered to first-time homebuyers.  If you haven’t, I’ll give you a quick rundown:  First-time homebuyers, defined as those people that haven’t owned or bought a home in the last three years, can qualify if they closed on a home between April 8, 2008 and June 30, 2009.  Currently, the credit has to be paid back over fifteen years (starting two years after you file), so it is more like a zero interest loan, but congress is trying to make it a true credit without a payback and they are trying to increase the tax credit to $15,000.

The $15,000 tax credit is not yet a law, but it has passed through the Senate and will most likely be signed off in Obama’s Stimulus Package.  The major updates will include not having to pay back the credit as well as opening it up to anyone buying any home, not just first-time homebuyers.  The time frame of the $15,000 credit will piggyback the current tax credit and may possibly be extended to the end of the year.  So those of you that have already purchased a home may be able to amend your taxes and get your tax credit.  Of course, everyone’s tax situation is different so don’t do your taxes based on this blog.  Instead, talk to an accountant.

I’m following this closely and will keep you updated via this blog, but if you have any questions, please give me a call.

***UPDATED HERE***

Visit msnbc.com for Breaking News, World News, and News about the Economy

In case you don’t want to take the 4 minutes to watch the video, I will list the myths for you here:

1. Sellers today are desperate – Very few sellers are in a desperate situation.  Don’t look at the days on market as an indicator of a good deal, instead focus on why the owner is selling.
2.  Don’t buy before prices have bottomed – This is a classic mistake because the bottom won’t show itself until prices are on their way up.
3. You can’t buy a home with less than 20% down – FHA is still offering first-time home buyers financing with 3.5% down.  Obviously, you still have to qualify, but the program does exist.
4. Now is the absolute worst time to sell – Although it is not a good time to sell, many markets are recovering.  Our own market here in Boise and the surrounding areas has been seeing much more activity in the past month compared to the last two quarters.
5. Before you refinance, shop around – I’m not sure I agree with this one, but the advice is true that your current lender will fight hard to keep your business so it may not be worth your time to shop around.

There you have it.  Now go search for a home or sell yours.

httpv://www.youtube.com/watch?v=bNmcf4Y3lGM

Thanks Kim!

The Idaho Business Review had an uplifting article yesterday.  They reported on the Idaho Housing and Finance Association executive director Gerald Hunter’s talk at the 2008 Economic Outlook Forum here in Boise.  Overall, Hunter believes that if we look at the long term picture of our housing market, we are still in good shape.  Comparing recent sales statistics with those over the past 10 years, we are still among the national average for valuation increase.  Yes, increase.  Over the last ten years we have still averaged a 5%+ annual increase in home prices. If we forget about those two fluke years (05/06), we’re doing great.  Say you bought before the boom, left the country for two years and came back, the market would seem just as normal as ever.

The unfortunate part is that many people bought during those two years so none of this 10 year average nonsense matters to them.  Well, the good news is that worst may be over.  According to Hunter:

“If you use that benchmark [referring to the annual growth increase], you may have to conclude that Boise has made its way through the housing bubble.”

This is not to say that we’ve reached “the bottom,” but it is a good sign that we are close.  Close enough, in fact, that any attempts at timing “the bottom” may be fruitless.  Over the next year as we approach the bottom (right now), reach the bottom (soon), and start to see price increases again, it may all blur together.  There won’t be a specific day that we can call the last day prices dropped.  And again, we won’t be sure we’ve hit the bottom until it has passed.

Remember, many of the issues we are facing today were caused by people planning to sell shortly after purchasing their home (history tells us you need to wait 4 years to break even on a home) or people trying to use their future equity today.  A home purchase is a long-term commitment and if you’ve considered and accepted this fact, you’re probably ready to buy. And right now, your timing couldn’t be better.

Photo Credit: Christine ™ via Flickr