“The local housing market has definitely gained momentum in the last few months as single-family home sales have risen year-over-year for eight months in a row. The increase in sales volume has helped fuel pretty significant gains in median prices over the last three months,” said Timothy M. Warren Jr., CEO of The Warren Group.

Warren added, “There’s growing confidence in the housing market. Historically, median prices have increased after consistent gains in sales volume, but there is real concern about what will happen to home sales once the federal government withdraws its support of the housing sector, including ending the home buyer tax credit.”

The median price for a single-family home climbed to $269,950 from $249,000 in February 2009. The year-to-date median home price is up 9.8% to $280,000 from $255,000.

Median prices increased in most regions, with the exception of the western part of Massachusetts. The median selling price in February fell in Franklin, Hampden and Hampshire counties.

In Franklin County, the median home price slipped 7.2% to $165,500 in February from $178,250 in February 2009. Hampden County’s median home price fell 6.3% to $150,000 from $160,000 during the same period, while Hampshire County’s median home price dipped 3.9% to $218,500 from $227,250.

Statewide, single-family home sales shot up 13.5% to 2,066 in February from 1,820 in February 2009. A total of 4,143 single-family home sales transactions were recorded in the first two months of the year, a 10.6% increase from 3,746 in the same months in 2009.

February condominium sales also increased, posting the sixth consecutive month of year-over-year gains. There were 939 condo sales in February, up 8.9% from 862 the prior year. Year-to-date condo sales surged 15.7% to 1,931 from 1,669 last year.

The median price for condos sold statewide in February increased 6.8% to $235,000 from $220,000. February was the fourth straight month that median prices have risen when compared to a year earlier. The median selling price for condos sold in January and February was $240,000, 10.6% higher than the $217,000 median price recorded a year ago.

Article printed from RISMedia

Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.

Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.

Here is more information about how the Extended Home Buyer Tax Credit can help prospective home buyers become part of the American dream. If you have specific questions or need additional information, please contact a tax professional or the Internal Revenue Service at 800-829-1040.

Who Qualifies for the Extended Credit?

First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010.

Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight.

To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.

If you purchased a home between January 1, 2009 and November 6, 2009, please see: 2009 First-Time Home Buyer Tax Credit.

Which Properties Are Eligible?

The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?

The maximum allowable credit for first-time home buyers is $8,000.

The maximum allowable credit for current homeowners is $6,500.

How is a Buyer’s Credit Amount Determined?

Each home buyer’s tax credit is determined by two additional factors:

The price of the home.

The buyer’s income.

Price

Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.

Buyer Income

Under the Extended Home Buyer Tax Credit, which is effective on November 7, 2009,  single buyers with incomes up to $125,000 and married couples with incomes up to $225,000-may receive the maximum tax credit.

These income limits have changed from the 2009 First-Time Home Buyer Tax Credit limits. If you purchased a home between January 1, 2009 and November 6, 2009, please see 2009 First-Time Home Buyer Tax Credit.

If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income-over $145,000 for singles and over $245,000 for couples are not eligible for the credit.

Can a Buyer Still Qualify If He/She Closes After April 30, 2010?

Under the Extended Home Buyer Tax Credit, as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.

The data uncovered a strong similarity in housing preferences between the two groups, with a few exceptions. The younger age group showed more interest in technology-heavy features, while the older group expressed a stronger preference for a single-story floor plan or one with a first-floor master bedroom, and a variety of universal design features.

One striking difference related to the desire for home services and community services. The younger group of mature consumers reported enthusiastically that they want services like home maintenance and repair as part of their next home purchase, along with services typically connected to older homeowners, such as housekeeping, onsite health care and transportation.

All of these were ranked higher than the desire for organized social activities-a surprise, inasmuch as social activities and amenities have been thought to be valued quite highly by this group. This finding supports an emerging trend among builders to look for ways to partner with providers of such services to the residents of their active adult/lifestyle communities.

Most buyers in this market are looking for an easy-living lifestyle. They would like access to services that will free up their time from maintenance both inside and outside their homes. This data tells builders that the homes we build for older active adults will remain attractive to the consumers who will be entering that market for the foreseeable future.

The share of households that will want lower-maintenance housing is large, and growing larger as Baby Boomers age into that segment of the market.

Finally, the date of purchase has been extended to April 30, 2010, meaning a binding P&S agreement is executed by April 30, with a closing date of no later than July 1, 2010. It is estimated that seven out of 10 current homeowners qualify. We have been advised by NAR not to expect any further extensions of the tax credit program beyond the dates above.

2. What are the new maximum income levels?
Much higher than before. For fi rst-time homebuyers the Modified Adjusted Gross Income limit is now $125k for singles and $225k for couples. For long-time residents of the same principal residence the limits are the same.

3. Has the credit amount been increased?
No. But the maximum credit amount is different depending on whether the taxpayer is a fi rst-time homebuyer or a non-first-time homebuyer. For first-time homebuyers the full credit is still $8,000 ($4,000 if married filing separately). For long-time residents of same principal residence the full credit is $6,500 ($3,250 if married filing separately).

The homebuyer will get this money in the form of a federal tax refund, just as before. Also, though it is still a true credit as opposed to a loan (recall the 2008 version), recapture or repayment would still be required if you sold your home within 36 months of purchase.

4. What housing qualifies as a principal residence purchase?
As before, single-family homes, condos, townhouses, and co-ops qualify so long as they are used as the taxpayer’s principal residence. A new IRS Q&A states that multi-family properties qualify for the credit; the amount is based upon the value of the unit that will be the principal residence and not the entire building. For example, with a $130K two-family, the credit is only based upon the value of one of the two units or $65k, 10% of which is $6,500. As with the previous rules, sales between immediate family members are ineligible. It is also important to note that the purchase price of the home cannot exceed $800k.

As part of the yearly New Year’s resolution-making ritual, the Alliance to Save Energy encourages consumers to check out their home’s physical fitness and, depending on its overall state of health, put it on an ‘energy diet.’

How is your Home’s ‘Physical Fitness?’
The “physical fitness” of your home can make the difference between soaring energy bills or comfortable savings this winter. By cutting wasteful energy use, an energy-efficient home is a strong defense against winter winds, rain, sleet, snow, and chill, while also reducing air pollution and greenhouse gas emissions and increasing national security.

And Uncle Sam is offering another incentive for putting your home on an energy diet: A 30% tax credit—a dollar-for-dollar reduction in your income taxes owed—of up to $1,500 during the remainder of 2009 and throughout 2010 for specific energy efficiency home improvements. Details on qualifying products, including insulation and sealing products, highly efficient furnaces, heat pumps, and windows, are available at www.ase.org/taxcredits.

The Alliance offers the following physical fitness tips to help cut your home’s energy bills and increase comfort.

Is Your Home Leaking Energy Dollars?
First plug air leaks. Your heating and cooling dollars could be going out your windows, doors, and electrical outlets. Seal all those air leaks with sealant or caulking and weather stripping.

Then, “insulate” yourself from price shocks. Install appropriate insulation for your climate based on R-values. Start with attic insulation, followed by exterior and basement walls, floors, and crawl spaces. Insulate and seal attic air ducts. These first two steps will increase your comfort, make your home quieter, and reduce your heating and cooling costs by up to 20%.

Go “window shopping” at www.efficientwindows.org to discover how high-performance ENERGY STAR-labeled windows can cut heating costs by as much as 30% compared to single-pane windows, while increasing indoor comfort and lessening fading of home furnishings.

Improve How You Care for and Heat Your Home
Heating accounts for 31% of the typical home’s energy costs. Sealing and insulating your home, as well as the other energy efficiency measures below, will lower your heating bills, increase your comfort, and decrease your carbon footprint.

Properly maintain your HVAC system. Just as a tune-up for your car can improve your gas mileage, a semi-annual or yearly tune-up of your heating and cooling system can improve efficiency and comfort.

Keep furnace filters clean. Check your filter every month, especially during heavy use months (winter and summer), and change it if it looks dirty. At a minimum, change the filter every three months. A dirty filter will slow down air flow and make the system work harder to keep you warm–wasting energy. A clean filter will also prevent dust and dirt from building up in the system, which could require expensive maintenance and/or cause early system failure.

Seal your heating and cooling ducts. In a typical house with a forced air system, about 20% of the air that moves through the duct system is lost due to leaks, holes, and poorly connected ducts. Sealing and insulating ducts increases efficiency, lowers home energy bills, and can often pay for itself in energy savings. Insulate ducts in unheated areas such as attics, crawlspaces, and garages with duct insulation that carries an R-value of 6 or higher. Also, a well-designed and sealed duct system may make it possible to downsize to a smaller, less costly heating and cooling system that will provide better dehumidification.

Let a programmable thermostat “remember” to lower the heat while your home is empty and/or overnight to reduce heating costs by up to 10%–and allow you to come home and wake up to a toasty, comfortable house.

Have to replace your HVAC equipment? Consider installing ENERGY STAR-qualified heating and cooling equipment. Installed correctly, these high-efficiency units can save up to 20% on heating and cooling costs. And, certain highly-efficient models qualify for the current federal income tax credit.

Open curtains and other window treatments on your west- and south-facing windows during the day to allow sunlight to naturally heat your home, and close them at night.

Replacing or purchasing energy-using and energy-related products? Save up to 30% in related energy bills with products earning the ENERGY STAR label, the symbol of energy efficiency, on some 50 product categories, including appliances, electronics, windows, lighting, and home office equipment.

For more information, visit www.ase.org

Fast-forward to 2006, at the height of the “boom” real estate market, and the FHA found itself backing just 3 out of 100 home loans, as “non-conforming” loans were being given to, pretty much, whoever asked for them, and their requirements were virtually hassle-free when compared to those that the FHA had in place.

Today, the FHA backs 3 out of every 10 new home loans, because, as other lenders have tightened restrictions, FHA has followed the status quo, keeping things fairly liberal.

The result of all of this? Problems. Big ones.

On December 2, 2009, the Secretary of Health & Urban Development, Shaun Donovan, stood before Congress and announced that the FHA’s cash reserves have fallen well below the Federally-mandated level of 2%, to a staggering .53%.

To try to alleviate the FHA’s problems and raise reserves to their legally-required levels, Mr. Donovan indicated sweeping changes would be coming to the FHA’s loan process. Here’s some of what you should expect:

More Money Down. One of the big reasons that FHA loans have been so popular over the years was low down-payment requirements — just 3.5%. FHA’s withering balance sheet, however has the agency requiring that buyers put more money down. The new down-payment requirement? As high as five percent.

Higher Fees. Fees for FHA loans have always been high. There are upfront and annual fees that borrowers must pay, which the agency uses to reimburse lenders in the event of default. The fees are already as high as the law will allow, but the agency is considering asking for increases.

Better Credit. Mr. Donovan said that the agency would, at least for now, increase the minimum credit score for new borrowers. The FHA’s current low-limit is a score of 500, though it’s important to note that most of the lenders funding FHA loans won’t accept a score of below 620, even now.

Lower Debt-to-Income Ratios. FHA has been lenient in the past, making exceptions with people with higher debt-to-income ratios (DTI) in the event of extenuating circumstances or those with longer credit histories. No more. The maximum allowable DTI will be 45%. This means that if your debt is more than 45% of your total income, you won’t be approved.

These changes will likely be implemented in early 2010, with the first kicking in during the first week of January.

The bottom line is that with the new FHA guidelines, a borrower’s bottom line will have to be straight, narrow, and raised much higher.

On a related note – the FHA Section 203K home loan is becoming an increasingly popular mortgage loan choice for home buyers purchasing a distressed property. This unique mortgage loan offers all the benefits of FHA financing along with the ability to provide funds for both the purchase and the renovation of a new home. Think about the possibilities - a single loan to buy and fix your home up!

“I don’t think we’re going to know until probably early fall whether we’ve got the incentives right and whether they’re going to prove powerful enough,” Geithner said while testifying before the Senate Appropriations financial services and general government subcommittee.

“But our judgment is that this is the best package of incentives, which offers the best return for the taxpayers’ resources we’re going to use to help address the housing crisis.”

The administration’s “Make Home Affordable” program is designed to help up to 9 million homeowners reduce their monthly mortgage payments to more affordable levels. The program, a key component of the administration’s efforts to stabilize the faltering housing markets, includes a provision to allow up to 5 million homeowners with a “solid payment history” on existing Fannie Mae or Freddie Mac loans an opportunity to refinance into more affordable monthly payments.

The administration said in May that only 55,000 homeowners were enrolled in the program.

“It is my feeling that the previous administration, and so far this administration, has failed to come up with an approach which could dramatically turn around this increasing number of mortgage foreclosures,” said subcommittee Chairman Richard J. Durbin of Illinois.

Geithner said that while the pace of decline in house prices has started to slow, “realistically, I think, you’re going to still see a very challenging period ahead for many homeowners.”

“Many more Americans are still at risk of losing their homes, and that’s why we just want these programs to work,” he said.

The secretary said the government “should’ve moved earlier to address this crisis,” which he said was at the center of the current recession.

“We were late as a country and behind the curve,” he said.

The secretary added that while the economy was beginning to show signs of recovery, “our country faces very substantial economic and financial challenges.”

The secretary was appearing before the panel to brief Congress of his department’s $13.4 billion budget request for fiscal 2010-a 5.3% increase compared with his department’s current budget.

A total of $332 million would be devoted to new Internal Revenue Service (IRS) enforcement efforts, including $128.1 million to add nearly 800 new IRS employees to combat offshore tax evasion and improve compliance with U.S. international tax laws by businesses and high-income individuals.

Another $130 million would go to bolster the security of IRS information technology, improve the efficiency of its business systems and upgrade its fraud detection capabilities.

IRS Commissioner Douglas Shulman, who also appeared before the subcommittee Tuesday, defended his announcement from last week that he is considering a plan to require income tax preparers to be licensed by the federal government as a way to root out fraud and raise compliance with increasingly complex tax laws.

More than 80% of American taxpayers use tax software or paid tax preparers to file their returns each year, which Shulman called a “transformational shift” in the way Americans pay their taxes.

“And because paying taxes is one of the largest financial transactions that individual Americans have each year, we need to make sure that the professionals who serve them are ethical, and that they ensure the right amount of tax is paid,” he said.

The commissioner said he hopes to deliver a proposal to the president on the issue by the end of the year.

“We recognize the earlier efforts made by the Administration and Congress, but strongly recommend taking additional steps to jumpstart the lagging housing market in order to stimulate a broader economic recovery,” said Richard A. Smith, president and CEO of Realogy Corporation and Chair of Business Roundtable’s Housing Working Group.

“If the housing market is not corrected or stabilized, the tide of the recession is not likely to reverse in the near term, and the slide in the economy overall will continue. We believe targeted, demand-side solutions-such as the ones Business Roundtable is recommending today-will provide a critical next step for a housing recovery that will help create jobs and boost the economy as a whole.”

The recommendations include expanding home buyer tax credit incentives from $8,000 to $15,000 while expanding eligibility from strictly first-time home buyers to all home buyers, regardless of income, on homes purchased as a primary residence. Among other recommendations, the CEOs also strongly encourage the Administration to continue ongoing efforts by the Federal Reserve to keep 30-year fixed mortgage interest rates at historically low levels and do so for the next 12 months, and to undertake a comprehensive review of existing foreclosure mitigation and loan-modification programs.

Business Roundtable’s Housing Working Group was formed on April 1 to provide actionable recommendations to Congress and the Administration on how to stabilize and grow the U.S. housing market. Recent reports indicate that without significant and immediate reform the U.S. housing market will continue its decline, further dragging down the economy.

“The Obama Administration’s extraordinary efforts to lower interest rates, along with its passage of the stimulus package, were both essential first steps toward stabilizing financial markets and promoting U.S. economic confidence,” said John Castellani, president of Business Roundtable. “Congress and the Administration must now build on these gains by stimulating demand for housing, which will create new jobs and trigger expansive economic recovery for America’s citizens, communities and companies.”

The group strongly believes adoption of its proposals will have a cascade effect, creating jobs and hastening U.S. economic recovery. The group’s recommendations are to:

1. Keep mortgage interest rates at historically low levels (below 5%) for at least one year;

2. Expand the current First-Time Home Buyer Tax Credit incentive from the lesser of 10% of the purchase price of the home or $8,000 to a higher limit of either 10% or $15,000 for all home buyers, remove the income restrictions and include all primary residence purchases for one full year;

3. Conduct a thorough review of current foreclosure mitigation and loan-modification programs in light of rising loan-modification re-default rates;

4. Make permanent the current temporary conforming loan limits; and

5. Continue to review and strengthen government efforts already underway to review and refine mortgage lending practices.

In addition to Richard A. Smith and John J. Castellani, the Housing Working Group consists of: Thomas C. Nelson, Chairman, President and CEO of National Gypsum Company; Steve Odland, Chairman and CEO of Office Depot; Daniel S. Fulton, CEO of Weyerhaeuser Company; Jeff M. Fettig, Chairman and CEO of Whirlpool Corporation; Michael H. Thaman, Chairman and CEO of Owens Corning; and Roger Fradin, President and CEO of Honeywell Automation and Control Systems.

Is it any wonder, then, that in a country where families are often scattered and relocations common, we’d crave a return to the community-building powers of the porch?

That’s a big part of the reason housing experts believe the front porch is regaining its importance in home construction.

Increasing demand for front porches in new homes was projected by most of the 60 builders, architects, designers and other specialists who were surveyed for the National Association of Home Builders’ Home of the Future study.

Among the panelists, 70% predicted front porches would become popular in new homes of about 2,400 square feet, while 79% expected it to be a desired feature in upscale homes of 3,000 feet or more. The experts aren’t talking about porches intended primarily for decoration.

This is something where you could actually sit out,  a covered space big enough to accommodate a swing or a table and chairs.

Front porches fit with the trend toward traditional home design, and they meet homeowners’ desire for a more casual lifestyle, he said. What’s more, porches feed people’s desire to belong. A front porch is an icon of the American neighborhood, and its presence helps create a sense of community almost instantly.

The orientation of porch to sidewalk encourages interaction-for example, close together but with the porch a few feet higher-without setting up the expectation of a long encounter, unless that’s what you want. A porch’s ability to promote that sort of casual exchange is the reason the architectural feature is often used in new urbanist developments, which strive to give new neighborhoods the feel and livability of older small towns.

New urbanism-also called new traditional development-de-emphasizes cars and encourages people to walk places, spend time outdoors and interact with their neighbors, fostering a sense of belonging.

The front porch may be an American icon, but it’s hardly an American invention. Its origins lie in the protected walkways that edged ancient Greek temples, the porticos of ancient Rome, the covered outdoor living areas of equatorial Africa and the Indian huts called barandas, Michael Dolan writes in “The American Porch: An Informal History of an Informal Place.”

The porch was common in 19th century America but started falling out of fashion early in the 20th century as indoor plumbing came into use. Porches, like outhouses, became symbols of houses that were outdated.

The demise of the front porch accelerated after World War II as ranch houses sprang up to accommodate the returning GIs and their burgeoning families. The houses’ simple construction meant they could be built quickly and affordably, and those little houses didn’t lend themselves to any complicated carpentry. The neighborhoods where those houses were built also emphasized the automobile over walking, and the orientation of homes moved to the more private space in the backyard.

Nevertheless, movies and TV shows continued to portray the front porch as a symbol of hearth and home, and the kids who grew up seeing those images now want to make those idyllic settings their own.

A front porch feels good, it just looks like it belongs - sort of like eyebrows on a depiction of a face. It’s detail that the eye wants.

What makes a good front porch?

• Size, for one thing, porch aficionados agree. A porch needs to be at least 8 feet deep to be comfortable, inviting and usable. Otherwise it’s like a really handsome pair of shoes that don’t fit.
• A porch should also be proportionate to the house, for aesthetics’ sake. Pay attention to the height of the railing.
• Materials are important, too. Natural materials like wood and stone, or those that have a more natural feel, are more pleasing to be near than their artificial counterparts.

Whether the problem making mortgage payments is short term or long term, the best option for homeowners often is to contact their lender to try to work out a new payment agreement. Lenders are not obligated to make mortgage modifications, however it is often in their interest to work out a feasible payment plan for the homeowner rather than foreclose and sell the property.

The Obama Administration’s Homeowner Affordability and Stability Plan included refinancing of qualifying mortgages owned or securitized by Fannie Mae or Freddie Mac to a lower fixed interest rate. As reported by the Washington Post, the Obama Administration announced that the program will apply to previously excluded second mortgages.

In part to help those outside this program, the Obama plan also included $75 billion in matching cash to encourage lenders to agree to mortgage modifications.

Here are a few tips to keep in mind when seeking a mortgage loan modification:

1. Don’t fall for any mortgage modification scams (such as advanced fee scams).

2. To learn how to best make your case for a loan modification, contact one of the HUD Approved Foreclosure Avoidance Counselors in your area. They can also inform you about any federal, state or local programs that may assist you.

3. Get an accurate picture of your finances. Your best chance at getting a modification is to demonstrate the ability to repay and a thorough understanding of the costs and income you face going forward.

4. If the problem making payments is short-term, ask your lender about forbearance or postponement of payments for a limited period. Be prepared to demonstrate when you’ll be able to start making payments again.

5. If the problem is long term, and what you need is modification, be prepared to make an offer and demonstrate how you could repay the modified loan. Be sure your lender is up to speed on incentive programs that may be available to help.

6. When negotiating a modification, make sure to understand how it will deal with any fees or penalties that may have accrued. Know what fees are in play and whether the modification will eliminate, reduce or tack them on for repayment.

7. If the lender won’t modify and foreclosure looms, consider asking the creditor to “produce the note,” (particularly when a creditor other than the original lender seeks foreclosure). It’s a stalling tactic, but can sometimes encourage creditors to negotiate.