Knoxville Tennessee Real Estate Blog

Sellers will consider lease purchase for this extensively redone home, 5 minutes to downtown Knoxville.

Below is a chart prepared by the National Association of REALTORS ® comparing the new changes to the Homebuyer Tax Credit.

The biggest change is that current Homeowners are now eligible if they sell their current homes and then buy AFTER the date of enactment of this extension which is November 6th, 2009.

Comparison of existing tax credit to extended and expanded version

www.KnoxvilleHomeCenter.com has all of the Knoxville TN area listings to view. Updated daily and NO REGISTRATION required to view home.

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Buy this terrific north Knoxville home and get up to $8,000 in tax credits to help.

It’s now official, President Obama signed an extension of the existing $8,000 homebuyers tax credit into law yesterday (Friday, Nov. 6th).

The new law extends the existing tax credit for Knoxville area buyers who have not owned a home that was their principal residence in the past three years and adds some new criteria and qualifying homebuyers.

The $8,000 credit was scheduled to lapse on December 1st, 2009 but will now be in effect through the end of June. Homebuyers must sign a contract before April 30, 2010 and close by June 30, 2010.

The income limits have been raised; Single buyers can now earn up to $125,000 and still get the full credit while a married couple can earn $225,000.

The bill also made more Knoxville, TN homeowners eligible to claim the credit on their taxes. First-time buyers — those who have not owned a home in the past three years — still qualify for an $8,000 rebate. But now people who want to trade up can also qualify. Those who have owned and occupied a residence for at least five years out of the past eight can claim a $6,500 tax credit if they close on a purchase by the end of June.

Some real estate industry experts weigh in on the extension:

“This bill will shift demand from the second half of 2010 into the first half,” said Pat Newport, a real estate analyst with IHS Global Research. “As a result, home sales and prices will get a boost in the first half of 2010, with payback in the second.”

“That’s not a bad thing, according to Bill Kilmer, vice president of advocacy for the National Association of Home Builders. It’s important to stabilize real estate markets quickly to help bring the economy out of its tailspin.”

The National Association of Realtors’ chief economist has this to say about the extension:

“The industry thought the credit would provide a ripple effect, with sales to first timers triggering as many three additional “move-up” sales.”

That did not happen, according to Lawrence Yun, NAR’s chief economist.

“It did not have the chain reaction impact it was supposed to,” he said. “Instead, many first-timers turned to vacant, foreclosed or other distressed properties the sellers of which were unlikely to be move-up buyers.”

So, the tax credit helped prop up the low end of the market without having much impact on the rest of the spectrum. Expanding the benefit to existing homeowners should boost those segments. That should produce additional benefits, according to Yun.

“Preventing further price decline or even nudging prices up a bit stabilizes housing wealth, which makes homeowners more comfortable in their spending,” said Yun. “They’re more likely to go out to the stores or buy a new car. That provides a boost to the overall economy.”

So let’s get busy Knoxville and Farragut homebuyers, it’s not that long until April 30th. Visit www.KnoxvilleHomeCenter.com today and pick out your favorite Knoxville area homes to go look at.

Call or email me with any questions of comments. (865) 693-3232

Knoxville and Farragut Tennessee homes for sale

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• $8,000 homebuyers tax credit extended (money.cnn.com)
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• Experts: Extended tax credit to boost local housing recovery (seattlepi.com)
• Homebuyer Tax Credit: Congress Gives New Buyers A $6,500 Break (huffingtonpost.com)
• Goldman: Tax Credit Extension Would Keep Home Prices Up (blogs.wsj.com)
• First-Time Home Buyer Tax Credit Gets Obama Nod (usnews.com)
• Congress giving homebuyers a $6,500 tax break (seattletimes.nwsource.com)