It’s all about buying power!

There are three factors that have created terrific buying power for today’s buyers.

1. Tax incentives
2. Extremely low mortgage interest rates
3. Plenty of inventory in most cities in America

These three combine to give today’s buyers a lot of buying power.  However, these buyers will soon lose two of these three factors.  With them they will see a huge amount of their buying power go!  At the end of the tax incentives they will lose either $6,500 or $8,000 depending on their situation.  However, many people  haven’t paid attention to the impact of increasing interest rates!  This will be an even greater loss in buying power.  Take a look at this:

• On a loan of $100,000 a 1% increase in interest rates will cost a buyer $11,500 in buying power and cost them $23,040.00 over the life of the loan
• On a loan of $200,000 a 1% increase in interest rates will cost a buyer $23,000 in buying power and cost them $45,720.00 over the life of the loan

You can see that the numbers get even larger with higher loan amounts.  So, buyers need to understand that a drop in home prices over the next several months can easily be lost by an increase in interest rates.  Why would anyone play that game when they can buy today at historically low rates, with a great selection of properties that are already priced to sell and they don’t have to deal with bank owned properties.  Instead, they are dealing with homeowners who care about the property and who need to sell.

Will interest rates climb this year?

The quick answer is, YES!  Why? because the Fed stopped buying Mortgage Backed Securities at the end of March.  This has already caused bond prices to go down and, in turn, mortgage interest rates to go up.  At the time of this post the rates have already increased about 1/4% and it’s only April 2nd!  How long will it take to go up a whole point or more?  Who knows but every bit they increase will cost a buyer dearly.

All Realtors need to inform their clients about what these changes are doing to their buying power.  We need to ensure that we understand the market and transfer that knowledge to our clients.  In reality, that’s what they pay us for, not just to open doors and say, “see, here’s the kitchen… isn’t it beautiful!” lol

The following details apply to the homebuyer tax credit expansion:

Who is Eligible:

• First-time homebuyers, who are defined by the law as buyers who have not owned a principal residence during the three-year period prior to the purchase, may be eligible for up to an $8,000 tax credit.
• Existing homeowners who have been residing in their principal residence for five consecutive years out of the last eight and are purchasing a home to be their principal residence (repeat buyers) may be eligible for up to a $6,500 tax credit.
• All U.S. citizens who file taxes are eligible to participate in the program.

Income Limits:

• Homebuyers who file as single or head-of-household taxpayers can claim the full credit
• ($8,000 for first-time buyers and $6,500 for repeat buyers) if their modified adjusted gross income (MAGI) is less than $125,000.
• For married couples filing a joint return, the combined income limit is $225,000.
• Single or head-of-household taxpayers who earn between $125,000 and $145,000 and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.
• The credit is not available for single taxpayers whose MAGI is greater than $145,000 and married couples with a MAGI that exceeds $245,000.

Effective Dates:

• The eligibility period for the tax credit is for homes purchased after Nov. 6, 2009, before May 1, 2010. However, home purchases subject to a binding sales contract by April 30, 2010, will qualify for the tax credit provided closing occurs prior to July 1, 2010.

Types of Homes that Qualify:

All primary residence homes with a purchase price of less than $800,000 qualify including:

• newly-constructed or resale
• single-family detached
• town homes
• condominiums

Vacation homes and rental property purchases do NOT qualify.

Tax Credit is Refundable

A refundable credit means that if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference.

Examples:

• A first-time buyer who qualifies for the full $8,000 credit who owes $5,000 in federal income taxes would pay nothing to the IRS and receive a $3,000 payment from the government. A first-time buyer due to receive a $1,000 refund, would receive $9,000 ($1,000 plus the $8,000 first-time homebuyer tax credit).
• A repeat buyer who owes $5,000 would pay nothing to the IRS and receive $1,500 back from the government. A repeat buyer due to get a $1,000 refund, would get $7,500 ($1,000 plus the $6,500 repeat buyer tax credit).
• All qualified homebuyers can take the tax credit on their 2009 or 2010 income tax return.

Payback Provisions:

The tax credit is a true credit. It does not have to be repaid unless the home owner sells or stops using the home as their principal residence within three years after the purchase.

The www.federalhousingtacredit.com site is being updated. Check the site for more detailed information on the tax credit.

]]> http://yourcharlotteconnection.com/2009-2010-tax-credit-information/feed/ http://yourcharlotteconnection.com/we-want-you-safe-during-this-holiday-season/ http://yourcharlotteconnection.com/we-want-you-safe-during-this-holiday-season/#comments Tue, 15 Dec 2009 16:21:27 +0000 Mark Ramsey http://yourcharlotteconnection.com/?p=586 The Ramsey Group wants the very best for you and yours.  So we are sharing the following important information provided by the Charlotte Mecklenburg Police Department (CMPD).  Please take a few minutes to read through their suggestions.

With the onset of the winter holidays, the Charlotte-Mecklenburg Police Department is stepping up patrols and taking special precautions to ensure the safety of citizens and shoppers throughout the holiday season. Beginning this week, with one of the biggest shopping days of the year, police presence will increase and continue through New Years.

Emphasizing the crucial relationship between the community and law enforcement, CMPD will be working with local businesses to reinforce precautionary measures for money management and business safety. The Department is also encouraging citizens to take preventive steps to ensure the securing of their property and their personal safety and offers these tips for the holiday season:

Safety While Shopping

1. Pay with checks or credit cards when possible. Don’t flash large amounts of cash.

1. Don’t leave any purchases or your purse unattended while shopping or in a dressing room.

1. Try to carry as little as possible. Make multiple trips to your vehicle to store your purchases.

1. Never leave your children alone.

1. If your children get separated from you, teach them to find a cashier or a security officer and ask for help.

1. Report all suspicious activity. Call 911 with a description.

Safety in the Parking Lots

1. Park and walk in well-lit areas.

1. Walk with confidence be aware of people around you, and know where you parked.

1. Always lock your car doors after leaving or entering your car.

1. Have your keys in your hand so that you don’t have to linger before entering your car. Check the back seat before you get in.

1. Don’t leave packages on the car seats. Keep packages out of sight in the trunk or under a covered rear cargo area.

Home Holiday Safety

1. Make sure your home is well lit. Turn on outside lights, spotlights, motions lights, etc. Leave several lights on timers while you are away to give your home that lived in look.

1. Keep all shrubbery trimmed. Do not allow shrubbery to conceal windows or doors.

1. Remove anything a burglar could climb up on to gain entry or use to knock out a window or door; items such as ladders, tools, tables, and chairs.

1. All exterior doors should be solid, rather than hollow core.

1. Don’t leave garage roll down doors open, even while you are home or while you are doing yard work.

1. Use a deadbolt lock to secure your doors. A good deadbolt should have a 1” throw, if you have glass within 40” of the lock a burglar could reach in and unlock the door. A double cylinder lock (this type needs a key on both sides to unlock) should be used if glass is near the lock.

1. If you are going away contact a trusted neighbor or friend to pick up your mail, newspaper and other delivered items.

1. Try not to leave gifts in open view. This is an invitation to burglars.

1. Don’t advertise new gifts or purchases. Break up cartons before leaving them at the curb or dispose of them another way the morning of trash pick up.

1. Don’t forget to engrave new gifts or purchases with your Drivers license number.

1. Don’t open your door to strangers. Be wary of solicitors and salespersons. If a stranger asks to use your telephone, tell them to stay outside, lock the door behind you and make the call for them. Never let a stranger inside your home.

1. Don’t give any information about yourself or your neighbor to a stranger.

What a great gift idea for your holiday shopping needs! You’ll have to Hurry because there’s only a limited amount of half off gift cards available.

From all of us here at The Ramsey Group we hope we’ve made your holiday shopping a little easier!

Keep your eye out for future opportunities to win other tickets from The Ramsey Group at Keller Williams Realty.

As you probably know, The Ramsey Group is the top real estate team helping people take advantage of the Tax Credit for first time home buyers, the Tax Credit for move up buyers, investing in real estate in the best real estate investment market in years and people selling their home. So, if you are looking to take advantage of this real estate market or you know anyone looking to buy a home, sell a home or invest in real estate please call us. We will take excellent care of them!

Thanks again to all of you who entered The Ramsey Group Carolina Panthers Tickets Giveaway!

We sell homes FAST!
Sorry but we sold this home in one week!  It’s no longer available but we have more homes.  People who need to sell their home in this market are turning to The Ramsey Group to get the job done!