New Oregon Cell Phone Law Effective 1/2010

Just in case you have not heard about the new law being enforced beginning of the new year: http://www.drivinglaws.org/oregon.php

Steel Cargo Containers-The Hidden Potential

It is always inspiring to see how people take used items and find a creative new purpose for them. Check out this guy who recycled an old steel cargo container into a cool outdoor office cabana. Or consider making a play house, guest house, art studio - the possibilities are endless! http://www.oregonlive.com/hg/index.ssf/2009/12/a_steel_cargo_container_become.html

It's Official! Obama Signed Tax Credit Extension

On November 6, 2009, President Obama signed a bill to extend the tax credit for first-time homebuyers through June 30, 2010. The bill also opens up opportunities for others who are not buying a home for the first time.

Below you will find a concise overview.

TAX CREDIT OVERVIEW

Who Gets What?
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.

What are the 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.

What is the Maximum Purchase Price?Qualifying buyers may purchase a property with a maximum sale price of $800,000.

What is a Tax Credit?
A tax credit is a direct reduction in tax liability owed by an individual to the Internal Revenue Service (IRS). In the event no taxes are owed, the IRS will issue a check for the amount of the tax credit an individual is owed. Unlike the tax credit that existed in 2008, this credit does not require repayment unless the home, at any time in the first 36 months of ownership, is no longer an individual’s primary residence.

How Much are First-Time Homebuyers (FTHB) Eligible to Receive?
An eligible homebuyer may request from the IRS a tax credit of up to $8,000 or 10% of the purchase price for a home. If the amount of the home purchased is $75,000, the maximum amount the credit can be is $7,500. If the amount of the home purchased is $100,000, the amount of the credit may not exceed $8,000.

Who is Eligible for the FTHB Tax Credit?
Anyone who has not owned a primary residence in the previous 36 months, prior to closing and the transfer of title, is eligible.

This applies both to single taxpayers and married couples. In the case where there is a married couple, if either spouse has owned a primary residence in the last 36 months, neither would qualify. In the case where an individual has owned property that has not been a primary residence, such as a second home or investment property, that individual would be eligible.

As mentioned above, the tax credit has been expanded so that existing homeowners who have owned and occupied a primary residence for a period of five consecutive years during the last eight years are now eligible for a tax credit of up to $6,500.

How Much are Current Home Owners Eligible to Receive?
The tax credit program includes 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.

Can Homebuyers Claim the Tax Credit in Advance of Purchasing a Property?
No. The IRS has recently begun prosecuting people who have claimed credits where a purchase had not taken place.

Can a Taxpayer Claim a Credit if the Property is Purchased from a Seller with Seller Financing and the Seller Retains Title to the Property?
Yes. In situations where the buyer purchases the property, even though the seller retains legal title, the taxpayer may file for the credit. Some examples of this would include a land contract or a contract for deed.

According to the IRS, factors that would demonstrate the ownership of the property would include:
1. Right of possession, 2. Right to obtain legal title upon full payment of the purchase price, 3. Right to construct improvements, 4. Obligation to pay property taxes, 5. Risk of loss, 6. Responsibility to insure the property, and 7. Duty to maintain the property.

Are There Other Restrictions to Taking the FTHB Credit?
Yes. According to the IRS, if any of the following describe a homebuyer’s situation, a credit would not be due:
They buy the home from a close relative. This includes a spouse, parent, grandparent, child or grandchild. (Please see the question below for details regarding purchases from “step-relatives.”)
They do not use the home as your principal residence.
They sell their home before the end of the year.
They are a nonresident alien.
They are, or were, eligible to claim the District of Columbia first-time homebuyer credit for any taxable year. (This does not apply for a home purchased in 2009.)
Their home financing comes from tax-exempt mortgage revenue bonds. (This does not apply for a home purchased in 2009.)
They owned a principal residence at any time during the three years prior to the date of purchase of your new home. For example, if you bought a home on July 1, 2008, you cannot take the credit for that home if you owned, or had an ownership interest in, another principal residence at any time from July 2, 2005, through July 1, 2008.

Can Homebuyers Purchase a Home from a Step-Relative and Still be Eligible for the Credit?
Yes. As long as the person they buy the home from is not a direct blood relative, the purchase would be allowed.

If a Parent (Who Will Not Live In The Property) Cosigns for a Mortgage, Will Their Child Still be Eligible for the Credit?
Yes, provided that the child meets the other requirements for the tax credit.

Senate Voted Today to Renew Tax Credit for First-Time Home Buyers

The Senate voted today to renew the government's $8,000 tax credit for first-time home buyers through the first six months of next year as part of a broader bill designed to extend unemployment benefits.

For the first time, the tax credit program would also enable many homeowners who buy a new primary residence to receive a $6,500 refund.

The bill, which passed 98 to 0, should reach the House floor by Thursday, House Majority Leader Steny H. Hoyer (D-Md.) said in a statement. His office said the legislation would then go to the White House for the president's signature.

The Obama administration has previously supported extending the $8,000 tax credit, and without congressional action the program would end Nov. 30.

Under the bill, first-time home buyers would receive the $8,000 tax credit if they sign a contract by April 30 and close on it by June 30. The plan would also make those who buy a new primary residence eligible for the $6,500 credit if they owned their current home for at least five consecutive years in the previous eight years.

But the measure limits the purchase price of the home to $800,000. It also imposes income caps so that people who make more than $125,000 annually and couples who make more than $225,000 would not be eligible for the program, which is estimated to cost $10 billion.
Sen. Johnny Isakson (R-Ga.), a longtime advocate of the tax credit, praised passage of the bill in his chamber but said the extension would be the last one.

"Tax credits like this only work by creating the sense of urgency to take advantage of them," Isakson said in a statement.

Supporters of the tax credit, including the real estate industry, say it has energized home buyers and helped increase sales. But critics say the program is too expensive and has attracted mainly people who were going to buy a home anyway.

In the Senate's measure, taxpayers would be able to claim the credit on their 2009 income tax return for purchases made in 2010.

Source: Washington Post, By Dina ElBoghdady, November 5, 2009

Will the First-Time Homebuyer Tax Credit be Extended?

Lawmakers are discussing extending the First-Time Homebuyer credit until April 30. At this time it is scheduled to expire on November 30th. If their proposal is approved, it would also expand to allow higher-income Americans and some who already own homes to qualify for the break.

Homebuyers who have lived in their prior residences for at least five years may receive a credit of $6,500 under the plan. Also, couples earning as much as $225,000 and individuals as much as $125,000 would qualify for the extended break. That’s up from a $75,000 limit for individuals and $150,000 for couples.

To read the complete article from Bloomberg.com click here. Stay tuned for more updates and find out if it becomes official when the proposal is voted on next week.

Thinking about moving to Portland?

Check out this great video to get a glimpse of what to expect!

Real Estate Market Update

June Residential Highlights
This June, same-month pending sales were up for the first time since December 2006 in the Portland metro area, and inventory reached its lowest point since August 2007.

Comparing June 2009 with the same month in 2008, pending sales were up 8.4%, while closed sales decreased 5.4%. New listings also dropped 18.3%.

Further, comparing June 2009 with May 2009, closed sales increased 24.5% (1,776 v. 1,427) and pending sales were up 10% (2,164 v. 1,967). New listings also rose 9.7% (4,257 v. 3,879).

Inventory fell to 8.2 months, dropping for the fifth consecutive month and reaching it’s lowest point since August 2007. Active listings typically rise at this time of year, but were virtually unchanged since May (14,491 v. 14,493). Conversely, actives increased 10.1% from May to June in 2007, and 4.2% in 2008.

Second Quarter Report
Comparing the second quarter of 2009 (April-June) with that of 2008, closed sales fell 15.3% (4,625 v. 5,461) and pending sales dropped 3.2% (5,784 v. 5,972). New listings decreased 23.8% (12,165 v. 15,973).

Sale Prices
The average sale price for June 2009 was down 14% compared to June 2008, while the median sale price also dropped 13.5%.

Month-to-month, the average and median sale price were mixed when compared with May levels; the average sale price was up 2.9% ($299,800 v. $291,400) and the median sale price was down 0.04% ($249,900 v. $250,000).

Source: RMLS Market Action