We’ve been talking about the $8000 tax credit for awhile now. It is a phenomenal program that we urge all first time homebuyers to take advantage of now, while they can. We’ve seen it help a lot of people jump over the fence and purchase a home, instead of continuing to rent. The article below was in the Tennessean this week and discusses how the tax credit has moved many buyers into the market and this in turn has helped get sales in a better place. For more details on the tax credit, click here.
Home Fair Could Open Door to Ownership
by Janell Ross
A bright green box near the center of Fox Ridge Homes’ Web site makes at least one aspect of the federal stimulus package clear. It’s filled with the images of $100 bills and the words "$8,000 Federal Tax Credit – Direct Stimulus to You!"
"I think what the tax credit does for renters is it makes them curious," said Chris O’Neal, a Nashville sales manager for Fox Ridge. "So it gets them out the door and looking at new construction or resales and seeing if that is really a possibility for them. It has stimulated sales for sure."
The company is one of nearly 50 homebuilders, financers, real estate agents and Realtors that will be represented at the mayor’s second annual Nashville Housing Fair, 1-5pm Sunday at Sommet Center. It’s free and open to the public, designed to provide an opportunity to learn about homeownership, the process of purchasing a home and the $8,000 federal tax credit for first-time homebuyers.
Homebuyers can earn the tax credit equivalent of $8,000 if they haven’t owned a home in the last three years and earn a gross income of no more than $95,000 for individuals or $170,000 for married couples. It’s part of the American Recovery and Reinvestment Act, signed into law in February, and applies to houses purchased as of Jan. 1. It ends Nov. 30.
There is some anecdotal evidence to indicate the credit is spurring sales in the Nashville area, said Mike Nichols, president of the Greater Nashville Association of Realtors.
"The less expensive homes are the ones moving faster and more often this year," Nichols said. "We don’t track first-time homebuyers across the market…so we can only surmise that least some of those sales are your first-time buyers. I think what the tax credit has been is an incentive to go ahead and buy now because the clock is ticking on that opportunity."
No known groups are tracking the effect of the homebuyer tax credits, said Marsha Courchane, executive vice president of the Richmond, Va.-based American Real Estate and Urban Economics Association. "These measures are great when it comes to marginal buyers, those who are on the edge of a decision who can access credit and perhaps have a down payment," she said. "What seems to be keeping people out of the market where we do have lower prices and a lot of foreclosures is that some people cannot access credit."
Closings have risen steadily in Middle Tennessee since March but remain well below last year, a Greater Nashville Association of Realtors report shows.