Thursday, March 25, 2010

Governor signs home tax credit bill

Governor Schwarzenegger today signed AB 183 providing $200 million for home buyer tax credits. The bill allocates $100 million for qualified first-time home buyers who purchase existing homes and $100 million for purchasers of new, or previously unoccupied, homes.

Eligible taxpayers who close escrow on qualified principal residences between May 1, 2010 and December, 31, 2010, or who close escrow on a qualified principal residence on and after December 31, 2010 and before August 1, 2011, pursuant to an enforceable contract executed on or before December 31, 2010, will be able to take the allowed tax credit.

This credit is equal to the lesser of 5 percent of the purchase price or $10,000, taken in equal installments over three consecutive years. Under the bill, purchasers will be required to live in the home as their principal residence for at least two years or forfeit the credit (i.e. repay it to the state). Buyers also must be at least 18 years old and be unrelated to the seller. First-time buyers are defined as those who have not owned a home in the past three years.

To learn more about the California Home Buyer Tax Credit, click here.

Friday, March 12, 2010

NAR official testifies about disaster insurance and FHA changes

NAR Immediate Past President Charles McMillan took the REALTOR® voice to Capitol Hill twice this week testifying before House subcommittees about insurance for natural disasters and the FHA Reform Act of 2010.

On March 10, McMillan was in front of two House financial services subcommittees urging them to create affordable insurance for natural disasters. He explained that property insurance is a key part of the home buying process; the cost of insurance also impacts housing affordability and that high insurance costs for multi-family and commercial properties are passed on to tenants in the form of higher rents.

McMillan suggested several solutions including federal policies that: protect property owners by making insurance coverage available and affordable; ensure that those living in high-risk areas understand their personal responsibility to purchase adequate insurance; support proper land-use decisions and building codes that also allow for local control and reinforce the role of government in maintaining infrastructure such as levees, dams and bridges.

On March 11, McMillan was back on Capitol Hill this time before the House Financial Services Subcommittee on Housing and Community Opportunity asking Congress to be careful about FHA reform and urging them to make the current conforming loan limits permanent.