Homebuyer Tax credit is extended and expanded!

Common questions regarding the new tax credit-

The UI bill including the homebuyer tax credit extension and expansion has passed the House by a vote of 403-12 after passing the Senate last night 98-0.

The new provisions take effect as soon as President Obama signs the bill, which we expect will be before the weekend. Including a couple questions received in the last couple days about the new credit:

1. Existing homeowner credit: Must the new house cost more than the old house?

A. No. Thus, for example, individuals who move from a high cost area to a lower cost area who meet all eligibility requirements will qualify for the $6500 credit.

2. I am an existing homeowner. On October 25, 2009, I signed a contract to purchase a new home. I have lived in my current home for more than 5 consecutive years and am within the new income limits. I will go to settlement on November 20. If President Obama has signed the bill by the time I go to settlement, will I qualify for the new $6500 tax credit?

A. Yes. The existing homeowner credit goes into effect for purchases after the date of enactment (when the bill is signed). There is no reference to the date of contract for the new credit. The provision looks solely to the date of purchase, which is generally the date of settlement.

3. I am a first-time homebuyer but was not within the prior income limits at the time I entered into my contract to purchase on October 30, 2009. I will be covered, however, by the new income limits. If the new rules have been signed into law by the time I go to settlement, will I be eligible for a credit?

A. Yes. The new income limitations go into effect as soon as the President has signed the bill. The income limit and other eligibility rules will look to your status as of the date of purchase, which is the settlement date. So if the new rules have been signed when you go to settlement, you should be eligible for the credit (or a portion of the credit if you're within the phase-out range).

4. I am an eligible existing homeowner. I have a fair amount of equity in my home. I have found a home with a non-negotiable price of $825,000. Will I be able to use any of the $6500 tax credit?

A. No. The $800,000 cap on the cost of the purchased home is firm at $800,000. Any amount above $800,000 makes the home ineligible for any portion of the credit. The $800,000 is an absolute ceiling.

5. I owned my home for 10 years, but sold it two years ago year and have been renting since. If I purchase a home, will I be eligible for the $6500 tax credit if I meet all the other eligibility tests?

A. Yes. Because you lived in the home for more than 5 consecutive years of the previous 8, you will qualify for the $6500 credit. For example, Say John and his wife bought a home in 2000 and lived there until 2008 when he got a divorce. Whether John has been renting or bought in the interim, he WOULD INDEED be eligible for the credit because he owned a home and occupied it as his principal residence for 5 consecutive years out of the last 8 years. The keyword here is "consecutive." As long as he lived in that house for 5 years straight, what he did since 3 years doesn't impact eligibility.

6. I am an eligible first-time homebuyer. I entered into a contract to purchase on November 1, 2009. Do I have to go to closing before December 1? How does the extension date affect me?

A. You do not have to close before December 1. Once the legislation has been signed, it will be as if the Nov 30 date had never existed. Therefore, so long as the contract settles before April 30 (or July 1, worst case), the purchaser will be eligible for the credit.

Homebuyer Tax credit is extended and expanded!

Real Estate
America's Most Livable Cities
Zack O'Malley Greenburg, 04.01.09, 5:15 PM ET


The beer at Gritty McDuff's might be enough to lure people to Portland, Me. Established in 1988, the downtown pub offers a smattering of small-batch ales brewed on the premises in addition to usual tavern treats. From the patio, customers can enjoy a pint along cobblestone streets or retire to the copper-topped bar for a second round.

Tasty microbrews aren't the only reason to like Portland. Thanks to high marks in five key quality of life metrics, Portland tops this year's list of America's Most Livable Cities.

"It's a very easy place to live," says Leon Perrin, 31, a manager at Gritty's. "It's small, so getting around isn't too much of a hassle. And it's a beautiful place throughout all four seasons."

In Pictures: America's Most Livable Cities

Perrin, who has lived in Maine for 20 years, is one of 513,000 residents living the good life in the Portland metropolitan area. The region earned high marks for income growth and culture; it also has low levels of crime and unemployment. Residents can afford the relatively high cost of living because of a 6.3% income growth rate over the past five years.

Bethesda, Md., and Des Moines, Iowa., round out the top three, followed by Bridgeport/Stamford, Conn., and Tulsa, Okla.

Behind the Numbers
To form our list, we looked at quality of life measures in the nation's largest continental U.S. metropolitan statistical areas--geographic entities defined by the U.S. Office of Management and Budget for use by federal agencies in collecting, tabulating and publishing federal statistics. We eliminated areas with populations smaller than 500,000 and assigned points to the remaining metro regions across five data sets: Five-year income growth per household and cost of living from Moody's Economy.com, crime data and leisure index from Sperling's Best Places, and annual unemployment statistics from the Bureau of Labor Statistics.

Modesto, Calif., ranks as the worst metro area with more than 500,000 residents. This crime-wracked enclave in the Central Valley demands the same moderately high cost of living as Portland with a third of the job growth and nearly three times the unemployment. Modesto ranked fifth on our roundup of the nation's most miserable cities earlier this year.

Denver, Colo., No. 11 on the list, ranks in part for its culture rank (19 of 379) and 4.4% income growth (77 of 379). The crime rating of Cambridge, Mass.' crime rating (29 of 379) helped it to No. 7 on our list. And though Little Rock, Ark., landed at 15, it boasts a 6% income growth rate (18 of 379) and a 5.4% unemployment rate (59 of 379.)

To be sure, Portland isn't perfect either. Its 5.9% unemployment rate is much lower than Modesto's, but it's still double its 2007 unemployment rate of 3.7%.

"There are less jobs to go around, but our main industry of tourism hasn't been affected much," says Perrin. "People are still coming to Portland."

Residents remain optimistic that their easy-living city will retain its desirability.

"Portland draws so many people because it has a strong arts, cultural, contemporary music and foodie scene," says Janis Beitzer, executive director of Portland's Downtown District. "It's a place where people set their own pace of life and work."

In Pictures: America's Most Livable Cities

Furnished Portland rental

Vacant Homes Bring Vacant Offers!

Does this photo grab your attention?



Add two rocking chairs, plant, lamp. Just a few pieces of furniture help the buyers imagination!

We all agree these are tough times in the Real Estate Market. One of the areas of home selling that sellers make it harder for themselves, is trying to sell a vacant home.

Vacant homes do not inspire a buyer to buy or brokers to set up showings for buyers. If you’ve seen one vacant room you’ve seen them all!

Real Estate agents typically list the property on the MLS (Multiple Listing Service) Sellers need to be aware that there is a maximum of 8 photos that can be uploaded. Two of those photos usually are exterior shots. The remaining 6 photos are interior shots. These 6 photos are crucial for attracting the interest of the buyer. If it’s shot after shot of vacant rooms,the buyer quickly exits and moves onto the next property. With the amount of inventory on the market, a seller needs to do all they can to hold the attention of buyers.

Here are five reasons to show why, especially in today’s market, it’s more important than ever to stage a vacant home.

· Homes that show well are the ones that are warm, inviting, and maKe an emotional connection with the buyer. Vacant homes rarely accomplish that goal
· Without furniture, there is no frame of reference, making it difficult for buyers to discern the scale and size of the room. Will the king bed fit in the master bedroom, the sectional couch in the living room? When buyers can’t determine if their furniture will fit, they are more likely to move on to viewing the next property on their list
· When homes are vacant, every flaw is exposed! Which can mean a seller is opening the door to lower offers.
· Only 10% of buyers can visualize, 90% won’t actually be able to visualize the home’s potential. You don’t have to be a gambler to see that these are terrible odds.
· A vacant home will send a message to buyers that the seller is desperate to sell. Right or wrong, knowing the seller has already relocated gives the buyer a distinct advantage when negotiating, often submitting a lower offer.

Statistics show that the ‘price’ of trying to sell a vacant home can be a lower selling price and a longer time on the market. Sellers must ask themselves if this is a price they can afford to pay in this Real Estate market.

Sometimes it is impossible to leave furniture behind. My suggestion is to have a budget for a few furniture items and accessories. Also, ask friends and family to borrow furniture. Not all rooms need to be staged. A few pieces of furniture can make all the difference!

Paula Jalbert Real Estate Staging /Townsend Real Estate

Staging Greater Portland

http://www.mystagingforrealesate.com/

Maine Real Estate information systems press release

PRESS RELEASE: In a press release to the Maine media today, MREIS reports single-family real estate sales decreased over 28% during January 2008, compared with January 2007, with a total of 495 homes being sold. Statewide median sales prices for those homes dipped just over 2% to a median sales price of $185,000. The median sales price indicates that half of the homes were sold for more and half sold for less. While prices decreased overall, several Maine Counties experienced double-digit price gains during the month of January. Nationwide, real estate sales were down 22.4% from January 2007. According to NAR, the median existing single-family home price dipped 5.1% to $198,700. The Northeastern United States experienced a 25.7% regional decrease in sales. However, NAR reported that prices rose 3.1% to $270,800 in the past year.

Boston Financial times article regarding Munjoy Hill

ARTS & WEEKEND
House & Home

By Rebecca Knight

Portland, Maine, is one of those idyllic American cities. With a population of nearly 65,000, it’s not too big and not too small. It’s clean and safe and has plenty of culture: a symphony orchestra, an acclaimed art museum and more restaurants per capita than most cities in the US. And that’s not to mention the fact that it’s within 30 miles of some of the most beautiful beaches and forests on the east coast.
There’s no question that Portland has been “discovered”; it is often written up in glossy magazines as one of the best small cities in the US in which to live. But there is one pocket that homebuyers are only just starting to notice. Munjoy Hill, situated at the north-eastern end of Portland’s peninsula, is without a doubt, its most up-and-coming area.
EDITOR’S CHOICE
Wild beauty, tamed prices - Dec-01
Tradition versus renewal - Nov-24
Seeking a Filipino sanctuary - Nov-17
Post-industrial living - Nov-10
Starting low, aiming high - Nov-03
From no go to all go - Oct-26
Almost exclusively residential, the neighbourhood overlooks the downtown and harbour to the south and the city’s Back Cove to the west, encircled by the Eastern Promenade, a series of grassy fields and public gardens that slopes down to picturesque Casco Bay.
Gordon Smith, a native San Franciscan, moved to Portland last year from Washington, DC. He chose to live in Munjoy Hill because he wanted to be in a place where “you had a sense of being close to the water”. “From my house, I hear the seagulls, I hear the foghorns and I have views of Back Cove and the city,” he says. “Being close to the water was really important to me.”
“Portland is getting a good deal of attention as a city that’s got a high quality of life,” says Kathryn Townsend of Townsend Real Estate. “And the Munjoy Hill neighbourhood, with its many parks and tennis courts, is good example of why that’s so. It’s for people who want a healthy lifestyle, like the outdoors, like to walk a lot and want to live in a place with a real sense of community.”
The area also offers easy access to The Old Port Exchange, a district known for its cobblestone streets, 19th-century brick buildings and fishing piers. Today, it is filled with trendy shops, vintage boutiques, restaurants and bars.
John Hatcher, an estate agent with Keller Williams Realty, says that Munjoy Hill is a “city neighbourhood with a distinctly small- town feel. It’s for those who want a less hectic urban lifestyle and that don’t want cookie-cutter suburbia. They want to be near the restaurants and shops in the Old Port but not at the expense of privacy and space.”
Munjoy Hill itself has also become decidedly hip. Funky, new restaurants such as The Front Room and The Blue Spoon have opened up, as well as new pubs such as Snug and gourmet coffee bars like North Star Café. “It’s got a good vibe, a cool culture,” says John Herrigel, an agent with Green Tree Realty. “It’s a neighbourhood for the younger crowd. It’s a great place to live in your late 20s and early 30s.”
This is a recent development. Even just a decade ago, Munjoy Hill was shabby and rough around the edges, according to Herrigel. “It used to be an area you wouldn’t want to walk around in at night,” he says.
But over the past few years local developers and savvy property buyers have snapped up the Victorian and Greek-revival-style properties and completed massive renovations inside and out. They’ve gutted the interiors, refinished wooden floors, added luxury finishes and installed new granite counters and stainless steel appliances. On the exterior, they’ve removed the scruffy aluminum and vinyl siding, and restored them to their original clapboard.
Smith, a lawyer, bought a three-storey, classic New England house earlier this year. A former carpenter, he is now in the process of renovating it. “I wanted a ‘project house’ in a sought-after neighbourhood where I could put in a lot of quality work and that that would be reflected in the resale price,” he explains.
If current trends continue, Smith will not be disappointed. While real-estate listing services do not break out data for particular neighbourhoods within Portland, the price trend for the city is moving upward. (And Munjoy Hill tends to be more expensive than Portland as a whole, according to local estate agents.)
For instance, a restored three-bedroom condominium on Morning Street, one block from the Eastern Promenade with water views from the back deck, was sold in September of 2001 for $168,000. It was sold again in August 2005 for $369,000, a 120 per cent increase, according to Hatcher, who worked on both sales.
Another modest, single-family home on Munjoy Hill sold in 2002 for $110,000 and was sold again in 2006 for $180,000, a 64 per cent increase, says Herrigal.
According to data from Multiple Listing Service and the Maine Real Estate Information System, for the month of July, the average price of a single-family home in the city of Portland was $255,588, while in 2005 single-family homes in the city went for $243,438. In 2004 that number was $229,900 and in 2003 it was $205,000.
Townsend says that the market has “stabilised” in recent months and that “things have calmed down since the buying frenzy” of 2005. “Two years ago buyers felt a lot of pressure to get in quick with offers otherwise they’d be left out in the cold,” she says. “But nowadays people don’t feel that pressure.”
It’s still possible to get a deal on Munjoy Hill but, according to Herrigal, “you’re paying a premium even if it’s a fixer-upper because that’s where the best resale value is”.
He says that the bargain properties are located on streets further away from the Eastern Promenade. “The houses right off the Prom are very nice and very expensive, and most of them have water views. The further away you get from the Prom the less nice the streets. Congress Street, Cumberland Street and Washington Street are probably the roughest areas and also where you’re likely to find a better price.”
“Bayside is another rough area on the fringe. But a new Whole Foods [upscale supermarket] just opened there so I think that within three to five years that area will be transformed. There’s good potential to add some sweat equity.”
Of course Munjoy Hill is not utopia. The long, dark, snowy New England weather is perhaps the biggest drawback for potential buyers. And property taxes are high. “The state of Maine has some of the highest real estate and income taxes in the country. And Portland – because it’s the biggest city – has the highest in the state,” says Hatcher.
Parking is another issue. “Most houses do not have off-street parking, which is a negative to the area,” says Townsend. “Also most houses are built on small city lots and have either tiny backyards or non-existent ones. But for those who want to live on the Eastern Prom, they just accept it.”
At this point, buyers in Munjoy Hill are mostly professional developers or locals seeking a primary residence but that is also starting to change. “We’re starting to see a trend of summer people from out of state coming in and buying here,” says Herrigel. Typically they already own a home in a warmer climate like California or Florida but they want to have a little place in Portland that they can spend May through to October in.”
The neighbourhood is particularly attractive to such home buyers because of its proximity to both the Old Portland beaches and the city’s cultural amenities, Hatcher adds. “They can fly into Portland Jetport, take a 10- or 15-minute cab ride to their place on Munjoy Hill and can enjoy all that Portland has to offer: arts, food, culture. But they are also close to the beaches and walking trails and parks if that’s what they have in mind.”
.................................................
Local agentsTownsend Real Estate, tel: +1 2078429200; http://www.townsendre.com/
Copyright The Financial Times Limited 2007