Can You Use the $8000 First Time Home Buyer Tax Credit as a Down Payment? Yes!

Can You Use the $8000 First Time Home Buyer Tax Credit as a Down Payment? Yes!
In an announcement made yesterday, May 12th, HUD (the department of Housing and Urban Development) said that they plan to allow First Time Home Buyers to use the 2009 $8000 tax credit as a down payment. HUD plans on releasing the official details next week but the idea is basically that FHA approved lenders will be able to monetize the tax credit in the form of a small bridge loan to allow a first time home buyer to use the tax credit toward the down payment of their home.
This is the most recent development in this program for First Time Home Buyers. It is a unique time in the market that a home buyer can purchase a home with an FHA loan and actually pay zero down at closing! This combined with historically low interest rates provides for quite a few incentives for the right buyer. I will update as more details get released on this program.

To read more about the $8000 First Time Home Buyer Tax Credit read:
$8000 Federal Income Tax Credit: First Time Home Buyers can get an $8000 tax credit for buying a house this year. and
NORTHWEST AUSTIN HOMES: $8000 Tax Credit- How to get a 10% rebate of your homes value.
Posted by Brian W Martin REALTOR for The Pinnacle Group of Keller Williams specializing in Assisting First Time Home Buyers to take advantage of incentives like we have never seen before in Austin, TX

NORTHWEST AUSTIN HOMES: Home Sales Update

NORTHWEST AUSTIN HOMES: Area NW Home Sales Update

Homes are selling in Northwest Austin.

Working with buyers and sellers in the area helps to give me first hand knowledge of what is going on. Some areas just do not have enough inventory for the demand of buyers. In the past few weeks I have worked with buyers that have missed out on a deal because of multiple offers, seen homes that are overpriced go "under contract" and negotiated contracts for multiple listings that I have. The newspaper paints a picture of a horrible housing market but anyone who is looking at the statistics and reality of what is going on in Northwest Austin would have to disagree. How do I know it is not just me and my experiences that make me think this? I look at the data from the MLS. Crazy, I know, but I like to make educated decisions and use resources that are available to me (and other Realtor's). As an example, I will be discussing what is going on in what is defined by the Austin Board of Realtors as Area NW.

Map of Area NW

In this article we will look at:

1. What homes are available in Northwest Austin?
2. How many homes are under contract?
3. What homes have been selling in NW?
4. Is this a buyers market or a sellers market?

What homes are available in Northwest Austin?

To start looking at this area, we first need to understand what homes are actually available to purchase in the area. For more about the types of homes in the area, read: What you get for the money or Hunters Chase and Milwood Homes. The table below shows a breakdown of price ranges of available homes. **These figures are all based on statistics of Single Family Houses and does not include condos or town homes.

As we can see in the chart, the majority of homes fall into the $150,000-$400,000 range. This does not tell us much information except what is currently available. These could be motivated OR unmotivated sellers, under priced OR overpriced homes. Currently, there are a total of 183 homes on the market. Next we need to look at what homes are under contract otherwise known as "pending" or "pending- taking backups".

How many homes are under contract?

There are currently 84 homes "under contract" in the area. That means that a deal is put together between the seller and a buyer and will most likely close in the next 30-45 days. This is an important factor to consider because this is what is happening in the area RIGHT NOW! By the time a sale goes through the information is at least 30 days old. 50% of the homes under contract are in the $150,000-$250,000 range. Now we need to look at what has SOLD in the past 6 months.

What homes have been selling in NW Austin?

By looking at what has SOLD in the last six months we can see what rate homes have been selling in the past. Out of 210 homes that have sold in the last 6 months (an average of 35 homes per month) over 50% are in the $150,000-$250,000 range.

Is NW Austin a buyers market? OR Is Northwest Austin a Sellers Market?
If you read the newspaper or watch TV, you are probably rolling your eyes at the screen and saying, "buyers market, duh!!" but how do we know?? More on that in a minute. First of all, a buyers market is when there is more than six months supply of homes within an area. A sellers market is when there is less than six months of inventory to sell to the demand of buyers. To calculate the # of months of supply, divide the # of homes available by the # of homes pending. This means that overall, Northwest Austin has just over two months of supply. That means that NORTHWEST AUSTIN IS A....... (drum roll please!)

SELLERS MARKET!

Lets look at price ranges to see if that rings true throughout.

$149,999 and less-3 active/9 pending=0.3 months=sellers market

$150,000-$199,999-36 active/24 pending=1.5 months=sellers market

$200,000-$249,999-36 active/18 pending= 2 months= sellers market

$250,000-$299,999-25 active/15 pending=1.5 months=sellers market

$300,000-$349,999-28 active/6 pending=~4.5 months=sellers market

$350,000-$399,999-21 active/6 pending=3.5 months=sellers market

$400,000-$449,999-12 active/5 pending=~2.5 months=sellers market

$450,000 and over-23 active/1 pending=23 months= buyers market!

This means that in all price ranges except 450k and above we are looking at a pretty significant sellers market. If you are looking at purchasing a home above $450k contact me today because there are some great deals!

Comparing these figures to the sold figures for the last 6 months also lets us know that there has been quite a bit of activity in the last 30 days. For example in the $200,000-$249,999 range 32 homes sold in the past six month (about 5-6 homes per month) BUT 18 homes are currently under contract that is 3X's the volume of activity.

Still wondering if now is a good time to sell? Contact me today for a FREE consultation about how you can sell your home for more $ today!

If you are looking at buying a home in the area make sure you are working with a professional so you can still get a great deal on the perfect home.

Posted by Brian W Martin REALTOR for The Pinnacle Group of Keller Williams specializing in Assisting Buyers and Sellers look at the facts about home sales in Northwest Austin, TX


Data taken from the Multiple Listings Service of Austin Board of Realtors. Information deemed reliable but not guaranteed.

NORTHWEST AUSTIN HOMES: How does hail effect the purchase or sale of your Northwest Austin Home?

NORTHWEST AUSTIN HOMES: How does hail effect the purchase or sale of your Northwest Austin Home?

On March 25th, there was a thunderstorm which included some of the biggest hail seen in Northwest Austin in about 10 years according to some residents. Hail the size of golf balls or in some areas, baseballs rained down on homes and cars throughout the NW Austin area as well as parts of Cedar Park and Round Rock. The storm left debris all over roadways and sidewalks. The area that was hit hardest was Jollyville. Some people don't even know where Jollyville is but it includes the areas of Hunters Chase, Milwood, and Anderson Mill. Many homes were damaged by the hail. Some had severe hail damage to their roof and windows. Many cars were damaged to the point of the car being "totaled". I was fortunate enough to be driving west on 620 toward the storm and pulled under one of the metal roofs at Sonic just in time. How does this hail effect a home that is currently under contract or those that are thinking of buying or selling? If you have a home with previous hail damage, what can you do? Let me tell you.
Those that had a home under contract when the hail storm hit are covered in their Texas Association of Realtors 1-4 Family Residential Contract-Resale (TAR 1601).
In paragraph 14 it basically says that if any part of the property is damaged or destroyed by fire or other casualty between the effective date of the contract (when all parties agree and sign) and the closing of the property, the seller, at the sellers expense needs to restore the property to its previous condition as soon as reasonably possible. So, if a house is under contract and a big hail storm comes through the area, it is the sellers responsibility to repair it to the condition it was in when the parties agreed to the terms of the contract. If the seller fails to make the repairs, the buyer has a few choices of what they want to do.

• A. The buyer can terminate the contract and the earnest money will be refunded to them.
• B. The buyer can grant the seller an extension of the time of performance and closing.
• C. The buyer can accept the property damaged and receive all insurance proceeds AND receive a credit from the seller at closing in the amount of their deductible.

It will be interesting to see how this plays out in the future as well. I have had a case where I was working with a buyer to purchase their home in Southwest Austin and in the inspection, there was noted roof damage that was done possibly from a hail storm a few months before. The seller contacted their insurance company, had the roof inspected and agreed to replace the roof. In this case both parties paid one half of the deductible but, one half of a deductible for a brand new roof is a great deal! Buyers beware!!! If you are looking at homes in any of these areas , I hope you are working with a professional that has already told you about this unusual circumstance. Practically any home you buy in that area should have a new roof or at least a thorough inspection to prove there is no damage.

Sellers beware!!! Don't go spending those insurance checks on big screen T.V.'s or a BMW at a "hail sale" because buyers will have the roof inspected and if they are working with someone that is knowledgeable, they will expect the roof at this point more than ever to be in tip-top shape.

***If you have found this information useful and are thinking of buying or selling your home, contact me today so I can help you to save money by making smart decisions.

Posted by Brian W Martin REALTOR for The Pinnacle Group of Keller Williams specializing in educating buyers and sellers to make smart decisions about their homes in Northwest Austin, TX

AUSTIN REAL ESTATE: Search for Foreclosures in Austin

AUSTIN REAL ESTATE: Search for Foreclosures in Austin

Would you or someone you like to purchase a home at a reduced price? Are you willing to do some repairs or updates on a home so you can buy a house below market value? Now it is a bit easier to find homes that may be a great value. On my AUSTIN AREA HOME SEARCH system, there is now a new feature that allows you to SEARCH FOR FORECLOSURES FOR SALE IN AUSTIN.



You can select all of your criteria just like a regular home search and select the "foreclosures" button next to the "active listings" button. This will find all of the available foreclosed homes that are listed for sale in the Austin MLS. The results will include any available photos and details of each house.

Every foreclosure is not necessarily a good deal. Banks that foreclose on properties are usually located out of the area work with local REALTORS and appraisers to try to assess the current market value of the home and to give advice on any repairs that can be made to help sell the home in about 60-90 days. Just like dealing with sellers of a home, some REALTORS will over price a home even when it is a foreclosure. The process is slightly more difficult and may take a bit longer so you want to be working with a professional to make sure you are getting a GREAT DEAL!

If you are able to find a great deal on a foreclosed house in the Austin area and you can take advantage of the $8000 FIRST TIME HOME BUYER TAX CREDIT, it is a decision that you will look back on as the greatest choice you have ever made. It is a unique time in AUSTIN REAL ESTATE that you are able to find a deal AND get money back from the government.

If you are interested in buying a foreclosure, go ahead and search on my site. If you have any questions about the process or if you would like to see any of these homes in person, please contact me today by email or call (512)638-5885.

Posted by Brian W Martin REALTOR for The Pinnacle Group of Keller Williams specializing in Assisting Buyers to find GREAT DEALS ON AUSTIN HOMES.

North and Northwest Austin Homes: What you get for the Money- $300,000-$400,000.

North and Northwest Austin Homes: What you get for the Money- $300,000-$400,000.

In an earlier post, I discussed what you can get for your money in NORTHWEST AUSTIN HOMES: Hunters Chase and Milwood Subdivisions.

Hunters Chase and Milwood are great areas to live and I am a resident there myself. It appeals to first time home buyers as well as couples or small families. As people move up in their career and/or their families grow, they start to think about moving up. This is where we would play the theme for The Jeffersons if this was on TV (Movin' on up...to the East side) Here in Austin, you don't have to move to the East side (unless you want to)***. Many people would like to move to a bigger home or a swankier area or both but still be close to work and the restaurants, shops and schools that their family is used to. Well, Northwest Austin is great for that. Less than five miles from areas that are great neighborhoods for first time home buyers and young families, there are great neighborhoods for move-up families. A move-up family is one or more people that own a home that they would like to sell and purchase a newer and/or bigger and/or fancier home.

Today I am going to focus on three general areas in Northwest Austin that are great for people looking to spend $300,000-$400,000 on a home. We will look briefly at what you can get in the areas of Great Hills, Canyon Creek and Balcones Village. There are other areas with a small concentration of homes in this price range like Balcones Woods and Jester but these are areas that have a good number of homes available in this price range.

Great Hills Austin Homes: This area is Southwest of the intersection of Hwy 183 and Loop 360. The homes are all around the Arboretum area. This area is all about location, location, location. Being close to the Arboretum means you are close to shops and restaurants and Great Hills is a golf course community with a lovely country club. Most of the homes in this area were built in the 80's and early 90's. For $300,000-$400,000 you can purchase a beautiful home with updates that is most likely 2000-2500 sq. ft. There are homes that are available that back to the golf course in this price range that may need some updates. This area is closer to Central Austin than Hunters Chase and Milwood so much of the difference in price is based on location and some of it is based on quality of construction and updates of the homes.

Canyon Creek Austin Homes: This area is South of R.R. 620 and West of Anderson Mill Dr. A majority of these homes were built from the late Nineties through 2005 or so. For the money here you can get a newer home than you would be able to in Great Hills and the home size is more likely to be around 3000- 3500 square feet with a larger yard. Homes are constructed well and this area has continues to appreciate in value because it is close to the lake and it is still easy to commute into Downtown or Northwest Austin area employers.

Balcones Village Austin Homes: This area is directly across Hwy 183 from Hunters Chase and Milwood. This area was mostly built out in the 70's and early 80's. A majority of what you can buy at this price point is going to be homes on about 1/3 acre lot that are about 2500-3000 square feet and some homes are on the Arnold Palmer designed Spicewood Golf Course. These homes are charming and were made with a solid construction.

Each of these areas have a unique character and make for a great place to move up to a larger home. It is basically a matter of preferences to where a buyer should choose a home. The most important thing is to feel good about the decisions you make when purchasing a home.

If you are thinking about selling your home and buying another to move up to, contact me today to ask about my "Move-up" special that will save you money!

***If you are interested in Moving on up to the East side, check out a great post by a fellow REALTOR Garreth Wilcock about what you can buy for $300,000-$400,000 in the Mueller Austin Development.

Posted by Brian W Martin REALTOR for The Pinnacle Group of Keller Williams specializing in Assisting People that would like to save money on their Move Up of Homes in Austin, TX

NORTHWEST AUSTIN HOMES: $8000 Tax Credit- How to get a 10% rebate of your homes value.

NORTHWEST AUSTIN HOMES: $8000 Tax Credit- How to get a 10% rebate of your homes value.

This is a follow up to my last article $8000 Federal Income Tax Credit: First Time Home Buyers can get an $8000 tax credit for buying a house this year.

Over the last couple of days, I have been thinking a lot about this $8000 tax credit that is being offered to first time home buyers that purchase a house, condo, town home etc. in 2009. While it seems like a good deal for people that are planning to purchase a home anyway, I have been thinking about if it will actually stimulate those people who were not already looking to purchase a house. For most first time home buyers in Northwest Austin, they will be looking to spend between $175,000 and $225,000 which is basically the range of average sales prices in the area. As you get closer to Balcones Woods or Great Hills and closer to Downtown Austin, it is more difficult to purchase a home in this range but for the most part, that is the range. When someone purchases a home for $200,000 in 2009, if they are a first time home buyer and they fit into the other criteria, they will receive a tax credit of $8000 this is equal to 4% of the sales price. That is pretty good if you consider the money will not have to be repaid and it is basically given as cash, especially if you file the credit on your 2008 taxes. You would get the money back pretty quickly. If the purchase was made with an FHA loan (with 3% minimum down payment) you would actually receive more money with the rebate than you initially put down on the property in the first place. Pretty good deal.

Now lets look at a great deal. The legislation allows for a tax credit up to 10% of the purchase price up to $8000. This means that is you were to buy something for less than $80,000, you would actually receive $8000 or 10% of the purchase price. That is pretty amazing if you think about it. During times of decent appreciation it could take up to 2 years to gain this much equity in a home. Now is a unique time to actually get 10% of the purchase price of your home rebated back to you in a short amount of time. For some it makes sense to file with their 2009 taxes but either way 10% is substantial.
Are there available Northwest Austin Homes for less than $80,000? Lets check it out. Here are Homes under $80,000 in Northwest Austin.

Contact me today to speak more about how you can take advantage of this limited time opportunity.

Posted by Brian W Martin REALTOR for The Pinnacle Group of Keller Williams specializing in helping First Time Home Buyers make great decisions to purchase Real Estate in Northwest Austin, TX

$8000 Federal Income Tax Credit: First Time Home Buyers can get an $8000 tax credit for buying a house this year.

$8000 Federal Income Tax Credit: First Time Home Buyers can get an $8000 tax credit for buying a house this year. Congress has recently enacted legislation that allows first time home buyers to receive a credit of up to $8000 on their income taxes. Unlike "credits" of the past, this will not need to be repaid. It is a dollar for dollar credit. This means that if you buy a home in 2009 and at the end of the year you owe $1000 in taxes, you will actually receive $7000 after filing for the $8000 tax credit. This new legislation definitely provides a fair deal of opportunity for prospective buyers. It also raises a lot of questions which I will address here. Who can get the $8000 tax credit? How is the amount of the credit determined? How do I file for the $8000 tax credit? Do I need to apply? What types of homes qualify for the $8000 tax credit? Can I claim the tax credit on my 2008 Federal Income Taxes or just 2009? Can the tax credit be used as a down payment? I don't have enough of a tax burden to have $8000 of tax burden credited. Can I still get the refund?

Who can get the $8000 tax credit?
The first qualification is that you are a first time home buyer. First time home buyer is a term that is defined by anyone who has not owned their primary residence for at least three years prior to the purchase. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) of more than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. Taxpayers with MAGI of more than $95,000 (single) or $170,000 (married) are not eligible for this credit.

How is the amount of the credit determined?
The tax credit is an amount equal to 10% of the purchase price up to $8,000. Basically this means that properties purchased by eligible buyers for more than $80,000 receive the $8000 credit. Properties bought for less than $80,000 would receive 10% of the purchase price as a tax credit.

How do I file for the $8000 tax credit? Do I need to apply?
Filing for the $8000 tax credit is easy. The paperwork is done simply while filing your Federal income taxes. Home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim that amount on Line 69 of their 1040 income tax return.

What types of homes qualify for the $8000 tax credit?
Any home that will be used as a primary residence. This can include single family residences, condominiums, town homes, manufactured (mobile) homes and even a houseboat.

Can I claim the tax credit on my 2008 Federal Income Taxes?
Yes. The legislation allows the credit to be claimed on 2008 taxes that have not been filed even if the purchase is made in 2009. This means that you can choose which year it would be best to offset your income if the purchase is made in time for 2008 tax filing.

Can the tax credit be used as a down payment?
No...Yes...well, kinda. Home buyers will receive the credit after the home is purchased so it can not be used for the down payment. However, qualified buyers could purchase a home in 2009 and have someone gift the down payment to them, which is as low as 3% with FHA financing, file their taxes for 2008 with the credit included and return the money to the family member/friend when they receive their tax refund.

I don't have enough of a tax burden to have $8000 of tax burden credited. Can I still get the refund?
Yes. Even if you have a refund, the credit will be added to it. For example, if you were to receive $1500 refund on your 2009 Federal Income Taxes, you could receive $9500 with the $8000 First Time Home Buyer tax credit included.

If this applies to you, this is the perfect time for you to buy a home. There are great deals available and with an incentive like this, it should make the decision to buy a bit easier.

There is a follow up to this article: NORTHWEST AUSTIN HOMES: $8000 Tax Credit- How to get a 10% rebate of your homes value.

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Believe it or Not: NW Austin is a Sellers Market (There are deals for buyers too!)

Featured Property: Pflugerville Townhouse

NORTHWEST AUSTIN HOMES: Hunters Chase and Milwood Subdivisions- What can you get for the money?

Posted by Brian W Martin REALTOR for The Pinnacle Group of Keller Williams specializing in helping First Time Home Buyers make great decisions to purchase Real Estate in Austin, TX