Posted By Linda Slocum on October 4, 2009
With the window of opportunity for the $8,000 first time homebuyer tax credit rapidly coming to a close, many buyers are scrambling to find their Dream Homes so they can close escrow before the November 30 deadline.
If you’re looking to take advantage of the first time homebuyer tax credit, remember that the rules state that you need to close escrow on or before November 30, or you won’t qualify for the credit. Also, remember that you “earn” your credit whether or not you pay federal income taxes this year, so this is really a nice bonus payment for first time homebuyers.
For purposes of this credit, a first time homebuyer is someone who hasn’t owned their own home for at least three years. Even those who have owned rental properties may qualify for the credit, as long as they have not owned a home as their principal residence during that 3-year window.
While November 30 may seem a long ways away, once you figure in a minimum 30-day escrow period the time to find your new home begins to shrink rapidly. Unless you’re an all-cash buyer or a well-qualified buyer that your lender can push through the system right away, if you’ve not had an offer accepted on your new home by the end of October you’ll likely not be able to take advantage of the $8,000 first time homebuyer credit unless the Feds decide to extend the deadline.
The inventory of Santa Clarita homes for sale remains very low, so there’s not a lot to choose from out there. The competition for available homes is still a bit crazy, with multiple buyers bidding on a single home becoming the norm. We are definitely trending towards a sellers’ market in the Santa Clarita area, with the multiple offers pushing sales prices above the sellers’ asking prices. Still, the home prices in Santa Clarita remain very low, so there’s a lot of opportunity for buyers to get in to homes at great prices!
If you’re a buyer, you should be working with a pro-active Realtor who can help you to stay on top of the Santa Clarita real estate market. New listings are quite often sold in just a few days and with multiple offers, so you’ll need to get in to see new listings and place your offer quickly in order to have any hopes of getting your offer accepted. Low-ball offers on new listings hoping for either acceptance of the low offer or a counter offer from the seller are not a good strategy right now, since sellers often have more than one buyer to choose from.
What can you do to maximize your chances of finding your new home in time to take advantage of the $8,000 federal tax credit? First, be sure that you have a pre-approval letter from a good lender. Then check new listings and price changes daily to see if something shows up in your price range. Be sure to get into these homes as quickly as possible, and don’t hesitate to write an offer on a home that you like. Waiting a few days to make that decision often means that another buyer will step in and you’ll not have the opportunity to purchase that home.
For sellers only: If you’ve been thinking of selling your home, now may be a great time to put your home on the market. Buyers can now purchase for as little as a half-percent down payment with the new downpayment assistance programs combined with existing FHA loan programs, and many buyers are scrambling to take advantage of the federal first time home buyer tax credit. If you price your home right and have it in good showing condition, you’ll likely have more than one offer to choose from in less than a week after listing your home for sale.
Looking for a good Realtor? Santa Clarita Realtor Linda Slocum is a Certified Residential Specialist (CRS) and a Certified Distressed Property Expert (CDPE) specializing in Santa Clarita residential real estate, bank-owned properties and short sales. You can reach her at 661.670.0349 or at homes@HoneyStartPacking.com.