On July 30th the President signed into effect the "Housing and Economic Recovery Act of 2008" without much fanfare from the Whitehouse or the Press. I don't even remember hearing anything about it on CNN or any other network news shows. So, what's the big deal? Well, maybe there is no big deal for homeowners or elected officials. What provisions of the Housing Stimulus Bill might impact you whether selling or buying?
First there is GSE (Government Sponsored Enterprises like Fannie Mae and Freddie Mac) and FHA Reform making permanent conforming loan limits up to $417,000 or 115% local area median home price, capped at $656,500. For Anne Arundel County, the HUD median home price is calculated at $448,000, setting the GSE and FHA limits for 2009 at $515,200. Although the effective date is immediate, the loan limits will not go into effect until 2009.
Second there is the Homebuyer Tax Credit. This is a $7,500 tax credit available to buyers on qualified purchases between April 8, 2008 and June 30, 2009. Homebuyers qualifying for the tax credit will get a dollar for dollar reduction on the tax they owe equal to ten percent of the purchase price of a home up to a maximum of $7,500. But beware, this is a loan disguised as a tax credit. Homebuyers will be required to repay the government over 15 years in equal installments for the tax credit amount received. So let's say you qualify for the full credit of $7,500. That means that the homebuyer will have a yearly loan payment of $500 for 15 years or $41.67 per month. The first repayment is due in the second tax year. And if the homebuyer sells before full repayment, then the balance is due immediately with the caveat that if the gain on the sale is less than the balance due the loan balance will be reduced.
There are other provisions of the Act that affect FHA foreclosures, seller-funded down payment assistance programs, and VA loan limits among others. It will be awhile before we know if this will stimulate the market.
In Conclusion
If you are thinking about buying or selling a home or know someone who is, for a confidential, private, professional consultation without any obligation to discuss today's real estate market, please contact Stephen Howell, Coldwell Banker Residential Brokerage, at 410-923-3217 or visit www.LiveInAnnapolis.com.
If you are interested in buying or renting a home in Annapolis, Maryland or the surrounding area and want to tour any property currently on the market, or if you have a home to sell or rent in Annapolis, Maryland and want a professional consultation on current market conditions, please contact me at 410-923-3217 or e-mail me at showell@cbmove.com or visit my website at LiveInAnnapolis.com.
Stephen Howell came to Annapolis to sail the Bay in 1994. What he discovered was a whole new lifestyle. Ever since Stephen Howell has been successfully helping others make the most of Annapolis. You'll find that with the right professional by your side, you can Live the Lifestyle and Live in Annapolis.
Stephen Howell and Rocky (his lab-mix from the SPCA of Anne Arundel County in Annapolis) live on the Chesapeake Bay near Annapolis, Maryland. He works in the Annapolis real estate market. His website lets people search the Washington and Baltimore metropolitan area MLS. Buyers can also search for waterfront homes along the Chesapeake Bay. His website has current real estate data on Annapolis, Anne Arundel County, and Maryland.
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