11.5.09 Senate Passes Tax Credit Extension, House Set to Vote

Yesterday the Senate voted to approve the extension and expansion of the homebuyer tax credit set to expire at the end of this month. Congress will vote today and is expected to pass the measure. The new rules of the tax credit will continue to allow first-time homebuyers or anyone who has not owned a home in 3 years to claim an $8,000 deduction on their taxes. Additionally, buyers who have owned their homes at least 5 years will be eligible for up to $6,500 in tax credits. The extension will last until the end of April, 2010, with all deals needing to close by the end of June. The credit can only be used for the purchase of a principal residence of $800,000 or less, which in the Bay Area will mean that some homebuyers are unable to taxe advantage of the credit. Also, there are income level restrictions on who is eligible for the tax credit ($125,000 for individuals, and $225,000 for those filing jointly).
The tax credit extension is good news for Bay Area home sales. We will continue to see a strong group of buyers out to take advantage of good home prices and tax incentives leading into 2010.