From the WSJ:
The real-estate lobby wants Congress to extend the amount of time that potential home buyers have to complete transactions that qualify for the $8,000 federal home-buyer tax credit.
To qualify for the tax credit, buyers had to sign purchase agreements by April 30. Those buyers have until the end of June to close on those sales, and anything that closes after that wouldn’t get the tax credit.
The problem, says the National Association of Realtors, is that many of those signed contracts are on foreclosures and short sales, where the lender allows the house to sell for less than the amount owed to the bank. Those transactions take longer than normal to process, and there’s some concern that many sales may not actually close in time.
“There could be a sizable number of home buyers who responded to tax credit incentives, but may encounter problems,” said Lawrence Yun, the trade group’s chief economist, in Wednesday’s report that showed a 6% surge in pending home sales during April.
The NAR and its members are asking Congress for flexibility with the June 30 deadline, but it is unclear when—or even if—something would happen. (The National Association of Home Builders says it is not asking for a deadline tweak.) Congress would have to pass such a measure quickly, which is no easy task. One possibility would be to attach the extension to a piece of legislation that’s already winding its way through both chambers.
Last week, Congress went into the Memorial Day recess without completing a bill to authorize new funding for the USDA’s rural development loan program, which lets some home buyers tap 100% financing. Without a last-minute reprieve, all would-be buyers can do is push for the different parties to close the deal in time.
State Tax-Credit Update
| As of | Estimated Total First-Time Buyer Applications Received | 57% of Estimated Requested Credit |
|---|---|---|
| 05/04/10 | 430 | $ 2,351,000 |
| 05/11/10 | 2,470 | $ 13,283,000 |
| 05/18/10 | 4,830 | $ 25,473,000 |
| 05/25/10 | 7,330 | $ 38,357,000 |
Any update on the $100 million for the New Home Credit part of State tax credit?
They decided not to publish an update for the new-home tax credit, for some reason.
There are so few new homes for sale state-wide, I suspect that credit will last for awhile (six months or more). Probably not worth updating the progress of such.
I’m surprised that only 38% of the new home credit has been claimed so far. I figured it would be almost gone by now.
We have an offer in on a short sale and the listing agent just came back to us and said the bank wants 30K more, noting in the email that if we agree then they’d be able to close by the end of June (and therefore qualify for the tax rebate). Hmmm. Pay 30K more so we can get $6,500 tax credit? We said no thanks.
Boo hoo hoo. Any time you get 15 months advance notice but end up 5 days late is nobody’s fault but yours. The original deadline was end of last year – April itself is an extension.
This is like the train that never leaves the station because it’s always waiting for one more person to fill it up.