The home buyer credit which was expected to boost sales and encourage buying with an incentive of a $6,500 tax credit, is not performing like had been expected.
The tax credit which offered up to $8,000 for people who had not owned a home for three years, had increased sales in the summer and fall of 2009. This credit was extended past it’s initial limited time with a slightly lower credit of $6,500 in hopes of keeping the buying momentum going. Unfortunately, the new credit is not boosting sales as it was hoped to with the unemployment rate still high and the economy still uncertain. Many potential buyers also face the dilemma of selling the home they are currently in before being able to purchase a new home… and for many selling a home where they owe more on it than it is currently worth, this is not an option.
To qualify for the $6,500 credit:
*Buyers must have owned and lived in the same home for five consecutive years out of the past eight.
*Buyer must sign a contract by April 30, and close before June 30.
*The home’s purchase price can’t exceed $800,000 and it must be used as a main residence. *The income limit for single taxpayers is $125,000 and for a married couple $225,000.