Many real estate organizations are fighting to get the first time buyer tax credit extended. Currently, the credit is scheduled to expire on November 30, 2009. There are bills in congress attempting to extend the bill, but nothing has passed at this point. To read up on the efforts to extend the bill, visit Jay Thompson’s site (aka The Phoenix Real Estate Guy).
Unless one of these bills gets passed, buyers must purchase AND close on a home by November 30 in order to claim the tax credit.
NOTE: In Missouri, home purchases typically take about 1 month from the time the contract is accepted until the deal is closed, so buyers who want to close by the deadline need to make an offer in the next few days.
Who is Eligible for the Tax Credit?
To be eligible for the tax credit, home buyers must be first time buyers, which the federal government defines as anyone that has not owned a primary residence in the last 3 years. If you owned a home in the past, but not in the last 3 years, you may be eligible.
There are also income guidelines.
For the full scoop on who is eligible for the tax credit, visit my article Missouri Residents can use the First Time Buyer Tax Credit at Closing to Cover Costs (FYI…the deadline for the MHDC tax credit advance program was October 15. Buyers now need to come up with the cash to cover the down payment and closing costs and will get the tax credit after closing upon filing their tax return).
Missouri Housing Market vs. U.S. Housing Market:
The tax credit definitely had a major impact on jump starting home sales in some of the hardest hit states.
Just like the rest of the country, the Missouri real estate market has slowed and home values have declined. But with only a small percentage of the nation’s foreclosures located in Missouri, our market was not as badly hurt as California, Arizona and Florida. It is not surprising that only a small percentage of the people who already claimed the tax credit by filing an amended 2008 tax return live in MO.
Home Buyers Claim the Tax Credit:
The U.S. Treasury released their August 2009 report with status updates for the Recovery Act Programs.
The report breaks down by state the 314,505 residents who claimed the tax credit by the end of August. Builderonline.com does a good job of summarizing some of fine print from the report which explains who is included and who is not.
Ryan Shaughnessy with the Lafayette Report crunched the numbers to show the percentage of home buyers by state who have already claimed the tax credit. Thanks Ryan for saving me from doing the math!
| State | # of Sales using Tax Credit | % of Total Sales using Tax Credit |
| Alabama | 5046 | 2% |
| Alaska | 485 | 0% |
| Arizona | 9357 | 3% |
| Arkansas | 3021 | 1% |
| California | 42,304 | 13% |
| Colorado | 6210 | 2% |
| Connecticut | 2230 | 1% |
| Delaware | 861 | 0% |
| District of Columbia | 471 | 0% |
| Florida | 29,132 | 9% |
| Georgia | 11,109 | 4% |
| Hawaii | 488 | 0% |
| Idaho | 2457 | 1% |
| Illinois | 9918 | 3% |
| Indiana | 5866 | 2% |
| Iowa | 3455 | 1% |
| Kansas | 3147 | 1% |
| Kentucky | 4105 | 1% |
| Louisiana | 4353 | 1% |
| Maine | 931 | 0% |
| Maryland | 5022 | 2% |
| Massachusetts | 4548 | 1% |
| Michigan | 9237 | 3% |
| Minnesota | 6964 | 2% |
| Mississippi | 2949 | 1% |
| Missouri | 6615 | 2% |
| Montana | 1041 | 0% |
| Nebraska | 2771 | 1% |
| Nevada | 5259 | 2% |
| New Hampshire | 1062 | 0% |
| New Jersey | 5500 | 2% |
| New Mexico | 1466 | 0% |
| New York | 8076 | 3% |
| North Carolina | 9355 | 3% |
| North Dakota | 659 | 0% |
| Ohio | 9172 | 3% |
| Oklahoma | 4300 | 1% |
| Oregon | 3565 | 1% |
| Pennsylvania | 10,250 | 3% |
| Rhode Island | 964 | 0% |
| South Carolina | 4684 | 1% |
| South Dakota | 886 | 0% |
| Tennessee | 8549 | 3% |
| Texas | 29,536 | 9% |
| Utah | 4623 | 1% |
| Vermont | 351 | 0% |
| Virginia | 9093 | 3% |
| Washington | 6229 | 2% |
| West Virginia | 788 | 0% |
| Wisconsin | 5202 | 2% |
| Wyoming | 648 | 0% |
| zz – Armed Forces | 177 | 0% |
| zz – Foreign | 10 | 0% |
| zz – U.S. Possessions | 8 | 0% |
| Total Sales | 314505 | 100% |
Impact of Tax Credit on Local Sales:
Over 17,000 homes have been sold in the St. Louis MLS region (including nearby counties) from January 1 – August 31, 2009. We won’t know the full impact of the tax credit until all of the 2009 tax returns are filled next spring.
With over 40% of buyers each year 1st time buyers, I think it is safe to predict that a high percentage of 2009 buyers will be claiming the tax credit.
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PDF Possibly Related Posts:
- Missouri Property Tax Credit for Buyers
- Who is Eligible for the New Housing Tax Credit?
- Housing Tax Credit for 1st Time Buyers & Current Homeowners
- 1st Time Buyers – Buy Now for Once in a Lifetime Opportunity
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