Home Ownership
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In Print: Wednesday, November 25, 2009
First Time Homebuyer Tax Credit Passes House
Congress passed an expanded version of the first-time homebuyer tax credit today. The bill is expected to be signed by Obama as early as tomorrow. The tax credit remains capped at $8,000, but the income limits for the first-time buyers has been raised, which will serve to allow even greater numbers of buyers to participate.
In the bill, income limits for buyers claiming the tax credit will be raised from $75,000 to $125,000 for individuals and from $125,000 to $225,000 for couples. The maximum ceiling for a home purchase under this program is $800,000. (Not bad for a first time purchase.)
There is an additional provision in the bill that allows for a tax credit of up to $6,500 to existing homeowners should they sell an existing primary residence and purchase another. Under that provision, they must have lived in the home for at least five of the past eight years.
Interestingly, the Senate approved the bill last week by a vote of 98-0. It passed in the House 403-12.
Household Tips …
Take your bananas apart when you get home from the store. If you leave them connected at the stem, they ripen faster.
Cheese
Store your opened chunks of cheese in aluminum foil.
It will stay fresh much longer and not mold!
Bell Peppers
Beef
Add a teaspoon of water when frying ground beef.
It will help pull the grease away from the meat while cooking.
Scrambled Eggs
Add garlic immediately to a recipe if you want a light taste of garlic and at the end of the recipe if your want a stronger taste of garlic.
Leftover Snickers Bars
Heat up leftover pizza in a nonstick skillet on top of the stove, set heat to med-low and heat till warm. This keeps the crust crispy.. No soggy micro pizza. I saw this on the cooking channel and it really works.
Easy Deviled Eggs
Put cooked egg yolks in a zip lock bag. Seal, mash till they are all broken up. Add remainder of ingredients, reseal, keep mashing it up mixing thoroughly, cut the tip of the baggy, squeeze mixture into egg. Just throw bag away when done easy clean up.
Reheating refrigerated bread
To warm biscuits, pancakes, or muffins that were refrigerated, place them in a microwave with a cup of water. The increased moisture will keep the food moist and help it reheat faster.
Newspaper weeds away
Start putting it in your plants, work the nutrients in your soil. Wet newspapers, put layers around the plants overlapping as you go cover with mulch and forget about weeds. Weeds will get through some gardening plastic they will not get through wet newspapers.
Broken Glass
Use a wet cotton ball or Q-tip to pick up the small shards of glass you can’t see easily.
Place a dryer sheet in your pocket. It will keep the mosquitoes away.
Squirrel Away!
To keep squirrels from eating your plants, sprinkle your plants with cayenne pepper.The cayenne pepper doesn’t hurt the plant and the squirrels won’t come near it.
To get something out of a heat register or under the fridge add an empty paper towel roll or empty gift wrap roll to your vacuum. It can be bent or flattened to get in narrow openings.
Reducing Static Cling
Pin a small safety pin to the seam of your slip and you will not have a clingy skirt or dress. Same thing works with slacks that cling when wearing panty hose. Place pin in seam of slacks and … ta da! … static is gone.
Before you pour sticky substances into a measuring cup, fill with hot water. Dump out the hot water, but don’t dry cup. Next, add your ingredient, such as peanut butter, and watch how easily it comes right out.
Hate foggy windshields? Buy a chalkboard eraser and keep it in the glove box of your car . When the windows fog, rub with the eraser! Works better than a cloth!
If you seal an envelope and then realize you forgot to include something inside, just place your sealed envelope in the freezer for an hour or two. Viola! It unseals easily.
Conditioner
Use your hair conditioner to shave your legs. It’s cheaper than shaving cream and leaves your legs really smooth. It’s also a great way to use up the conditioner you bought but didn’t like when you tried it in your hair.
To get rid of pesky fruit flies, take a small glass, fill it 1/2′ with Apple Cider Vinegar and 2 drops of dish washing liquid; mix well. You will find those flies drawn to the cup and gone forever!
Get Rid of Ants
Put small piles of cornmeal where you see ants They eat it, take it ‘home,’ can’t digest it so it kills them. It may take a week or so, especially if it rains, but it works and you don’t have the worry about pets or small children being harmed!
INFO ABOUT CLOTHES DRYERS
Housing Affordability
For the first time in a long time, the real estate trend has taken a positive turn here. June single family sales in both Okaloosa and Walton Counties were actually up over the same month last year.
An anomaly? We don’t think so. Most of the rest of the state has been experiencing increases in the number of transactions as compared to last year. Perhaps the Emerald Coast simply lags a little behind?
Interest rates have ticked up a little in response to many factors, not the least of which is the threat of increased taxation. However, low demand has kept the markets competitive – at least for now.
Nevertheless, the all-important “Housing Affordability Index” now stands at a 28 year high. Simply put, a higher percentage of Americans can afford to purchase a home today as compared with any year going back to 1981!
Check ourt website at http://www.FloridaBrokers.com for more!
Q: When does the $8,000 new buyer tax credit expire?
The new buyer tax credit applies if you are a first time buyer and close on a primary residence between January 1st and December 1st 2009. However, a bill has just been introduced that would not only raise the tax credit to $15,000, but would also make the credit available on any primary residence purchase, even if not the case of a first time buyer. The bill would also eliminate the current income ceilings of $75,000 for individuals and $150,000 for couples.
Business Looking Up in Florida
Remembering that real estate was the first “industry” to feel the impact of a weakening economy, it stands to reason that it may lead way to recovery.
Real estate sales transactions have been increasing around most of the rest of the state for the past year or so. The Emerald Coast, or Northwest Florida in general is typically believed to trail the rest of the state by from 12 to 18 months, depending upon whom you ask.
So, sales transactions are finally increasing here as well. Not as compared with last year, but as compared with recent months. This 2009 positive trend is the result of a number of things:
1. Interest rates are incredibly low.
2. Sales and asking prices are incredibly low.
3. Inventory levels are high – Choices are plentiful.
4. $8,000 tax credit for first time buyers.
5. An overall sense that prices will not decline much further.
Moreover, we have never seen low mortgage interest rates and low housing prices at the same time. This is an unprecedented opportunity for buyers. This helps to explain why we are seeing so many institutional buyers and investors coming back into the market. We are being approached by REITs and others, searching for investment properties, both residential and commercial.
You cannot turn a battleship on a dime, and neither will this economy rebound in an instant. What we are seeing now are the early signs of a real estate recovery. Some prices may very well go lower before they go higher, but as sales transaction numbers continue to improve, the brighter becomes the light at the end of the tunnel.
How will this new Fannie Mae home refinance program work?
Unfortunately, the program referred to as “Making Home Affordable” (MHA) will not benefit many homeowners in this market. Call me a cynic, but I believe that the scope of this program is so narrowly focused that very few homeowners will be able to qualify.
The reason is that area depreciation (like so many others) has been severe. This program will not allow you to refi more than 5% above the current value of your home. As an example – Say you had put 10% down on a home in 2005. If that home has now depreciated by 25%, you would be 15% “upside down”, or 10% above the qualification threshold.
Look at it another way:
$300,000 - Purchase price in 2005
$ 30,000 - Down Payment
$270,000 - Mortgage Balance
$225,000 - Current Value (25% less than original purchase price)
$236,250 - Maximum MHA refi loan amount (5% above current value)
As you can see, there is a difference (deficit) of $33,750 between the existing mortgage balance and the amount that could qualify for a MHA refi.
This program equates to typical government fuzzy math. It’s like putting lipstick on a pig – It sounds cute but it does not accomplish much
First-time homebuyers: How to get the $8,000 tax credit
This has been a hot topic, so we thought that this article may help answer a lot of common questions:
WASHINGTON – Feb. 17, 2009 – How does a first-time homebuyer take advantage of the $8,000 tax credit that President Obama is expected to sign into law tomorrow? It comes with a few rules. According to the most recent analysis, the following rules will apply – though things could change as tax professionals weigh the details:
• The deduction is worth 10 percent of a home’s value up to $8,000, which means all homes worth more than $80,000 could qualify for the maximum amount.
• There is an income limit to qualify. A married couples’ modified adjusted gross income (MAGI) should be under $150,000 and single filers’ MAGI should be less than $75,000.
• Partial tax credits may be available for married couples with MAGI incomes over $150,000 but under $170,000, and single filers with incomes over $75,000 but under $95,000.
• If married couples file separately, they can both claim 5 percent of the home purchase ($4,000 each for a home over $80,000) on their tax returns.
• It’s a tax credit, not a deduction. That means the entire amount goes back to the first-time homebuyer unlike deductions, such as mortgage interest, that are subtracted from gross income before tax is calculated. If qualified for $8,000, the buyer gets $8,000, even if they would not owe that much in taxes otherwise.
• The tax credit applies to homes purchased between Jan. 1, 2009, and Dec. 31, 2009.
• The tax credit does not have to be paid back, providing the homebuyer keeps the property for at least 36 months and resides in the home.
• To qualify as a first-time homebuyer, the purchaser cannot have owned a home within the previous three-year period. However, ownership of a vacation home or rental home does not disqualify the buyer.
• If purchasing a new home, the effective date to receive the credit is the first day the homeowner actually lives in the house. If construction began in 2008, that buyer could still qualify. And if construction begins in 2009 but the owner does not take possession until 2010, the buyer would not qualify.
• The tax credit can be claimed on 2008 income tax forms even though the purchase took place in 2009. A buyer could close on a home the same day that President Obama signs it into law, fill out their income tax forms the next day, and receive the tax credit fairly quickly.
The tax credit is not a downpayment, but it could be used toward a downpayment if first-time homebuyers plan ahead. U.S. taxpayers have money withheld from every paycheck for income taxes. If they owe more tax than the amount deducted, they pay the IRS; if they owe less, they get a tax refund.
By anticipating at least an $8,000 refund in early 2010 when they file 2009 taxes, these buyers could cut down on their tax withholding this year and save the money toward a downpayment. There is one caveat, however: Should they not buy a home in the qualifying period, they would still owe the IRS the money, and reducing their withholding amount could result in a high bill at tax time.
© 2009 FLORIDA ASSOCIATION OF REALTORS®
Bills to address flaws in condo-insurance law
Letters from condo associations to unit owners demanding owners to show proof of insurance within 30 days or the associations will buy coverage on their behalf have prompted hundreds of complaints, lawmakers said.
The law, which took effect Jan. 1, also requires condo owners to add the association as an insured party on the policy.
Associations typically buy insurance that covers the building, while owners are responsible for buying policies to cover their units’ interior – flooring, cabinets, appliances and the like. Many owners, however, opt not to spend the money and were not required to – until now.
After the 2004 and 2005 hurricanes, many associations faced the problem of damaged or destroyed units that were not repaired because unit owners had no insurance. The associations wanted to be able to force owners to have the proper coverage. Before Jan. 1, only lenders could buy coverage for a home or condo if the owner let it lapse or canceled the policy.
The new law has owners confused and worried about the cost.
“Condo owners are coming and saying, ‘Tell me what I should buy,’” said Carol Everhart, an agent with BB&T Insurance in St. Petersburg.
Everhart, who sits on the board of Citizens Property Insurance, the state-run insurer, works with more than 200 condo associations.
‘Economic issue’
“It’s not such a bad law. But it’s an economic issue,” said Dulce Suarez-Resnick, an executive at Brown & Brown Insurance.
A condo policy for a small apartment (about 750 square feet in a modest building) can cost about $1,000 a year. A luxury condo with plenty of marble and granite and a high-end interior could cost as much as $5,000 a year, she said.
In addition, the law is flawed, agents said, because no insurer in Florida will sell coverage for an individual unit to a condo association and then have the association bill the owner.
The problem, says Donna Berger, general counsel for the association lobbying group Community Advocacy Network, is that the new law makes having the insurance mandatory rather than voluntary.
Already two bills – one by Rep. Ellen Bogdanoff of Fort Lauderdale and the other by Sen. Dennis Jones of Seminole – have been filed that will make some fixes in the “glitches” in new law.
Both bills would make the insurance coverage voluntary – not mandatory – for unit owners and would allow the associations to buy the coverage if they choose to and then bill the owners.
‘Unhappy’
Rep. Julio Robaina of Miami said his office has fielded hundreds of calls from condo owners all over the state who have gotten letters from their associations and don’t know how to proceed.
“They’re unhappy with the mandates of the new law. But [an owner] might have to buy a policy until a new law is passed,” said Robaina.
There is no penalty for not following the law, so associations could decide not to enforce it with their owners.
But agents like Suarez-Resnick and Gaby Dominguez at Avanti Insurance in west Miami-Dade County say buying insurance to cover the contents of their units as well as the interior is a good idea for condo owners to do anyway.
“The biggest mistake condo owners make is to not buy insurance because they think their units are covered by the association’s master policy,” said Suarez-Resnick.
Another aspect
One provision in the new law that isn’t controversial requires unit owners to purchase loss-assessment coverage of at least $2,000. That coverage would help pay for an additional charge levied by the association after a major storm to cover any shortfall to pay needed repairs.
Right now, most policies include coverage of $1,000 and many carriers were already increasing it voluntarily to $2,000, said Everhart.
But she said this coverage should be applied to the assessment deductible so that the additional cost does not burden unit owners.
Copyright © 2009 The Miami Herald, Beatrice E. Garcia. Distributed by McClatchy-Tribune Information Services.