Tax Credit for New Homebuyers

Happy Wednesday!

Tax Credit for New Homebuyers

There have been a lot of questions about the New Homebuyer Tax Credit. So, we thought we would put together a quick reference guide for you and your clients. We have also attached the form that your clients will need to fill out for their taxes with this email.

New Homebuyer Tax Credit Explained

FEATURE
CREDIT AS CREATED JULY 2008

APPLIES TO ALL QUALIFIED PURCHASES ON OR AFTER APRIL 9, 2008
REVISED CREDIT –

EFFECTIVE FOR PURCHASES ON OR AFTER JANUARY 1, 2009 AND BEFORE DECEMBER 1, 2009

Amount of Credit
Lesser of 10 percent of cost of home or $7500
Maximum credit amount increased to $8000

Eligible Property
Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence.
No change

All principal residences eligible.

Refundable
Yes. Reduces (or can eliminate) income tax liability for the year of purchase. Any unused amount of tax credit refunded to purchaser.
No change

Purchasers will continue to receive refund for unused amount when tax return is filed.

Income Limit
Yes. Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000).
No change

Same income limits continue to apply.

First-time Homebuyer Only
Yes. Purchaser (and purchaser’s spouse) may not have owned a principal residence in 3 years previous to purchase.
No change

Still available for first-time purchasers only. Three-year rule continues to apply.

Revenue Bond Financing
No credit allowed if home financed with state/local bond funding.
Purchasers who utilize revenue bond financing can use credit.

Repayment
Yes. Portion (6.67% of credit or $500) to be repaid each year for 15 years, starting with 2010 tax filing.
No repayment for purchases on or after January 1, 2009 and before December 1, 2009

Recapture
If home sold before 15-year repayment period ends, then outstanding balance of repayment amount recaptured on sale.
If home is sold within three years of purchase, entire amount of credit is recaptured on sale. Applies only to homes purchased in 2009.

Termination
July 1, 2009

(But note program changes for 2009)
December 1, 2009


Effective Date
Purchases on or after April 9, 2008 and before January 1, 2009. Repayment to begin for 2010 tax year.
All revisions are effective as of January 1, 2009


FHA Loan Limit Increase Update

We have noticed that many of you are still not aware of the recent FHA Loan Limit Increases. The loan limits have been returned to the higher amounts that were approved in 2008. Here is a summary of what the New FHA Loan Limits are

$406,250 - Adams, Arapahoe, Broomfield, Denver, Douglas and Jefferson

$460,000 - Boulder

$417,500 - Weld

$312,000 - Larimer

Weekly Market Watch

It Was a Week of Surprises…And Best of All, Spring Has Sprung!

First, CNNMoney.com reported a sudden, unexpected surge in U.S. housing starts. According to the Commerce Department, housing starts rose to a seasonally adjusted annual rate of 583,000 last month, up 22% from a revised 477,000 in January. The big surprise: Economists were expecting starts to decline to 450,000, according to consensus estimates by Briefing.com.

Furthermore, applications for building permits, considered a reliable sign of future construction activity, rose 3% to a seasonally adjusted annual rate of 547,000 last month. The other big surprise: Economists were expecting permits to fall to 500,000.

Also interesting this week, retail sales figures fell much less than expected in February, and surprisingly strong January sales were revised even higher. According to CNNMoney.com, “U.S. store sales showed a smaller-than-expected decline in February after an unexpected surge in January that was bigger than originally reported…The Commerce Department said total retail sales fell 0.1% last month, compared with January’s revised increase of 1.8%. Economists surveyed by Briefing.com had been expecting a decrease of 0.5% for February.”

So, is it safe to call this a trend? Are we out of the woods yet? It’s tough to say. In all honesty, you don’t know whether or not you’ve hit bottom until you’re on your way back up but it seems some of the critical signs are starting to show signs of life which is welcome relief for our wounded economy.

Also in the news this week, the Federal Reserve announced plans to purchase up to $750 billion in mortgage-backed securities and up to $300 billion in longer term Treasury securities. Our representatives at the National Association of Realtors applauded the plans noting “This is great news for American home buyers and homeowners because mortgage interest rates will continue at historic lows.”

What this means for Americans is that a greater number of home buyers will be able to purchase a home and homeowners facing challenges will be able to refinance into better terms. As NAR noted, “We already are experiencing a great improvement in housing affordability due to historically low interest rates and the Fed’s move will push affordability conditions to the best levels in 40 years. In addition, continued low rates will lessen foreclosure pressure and help stabilize home prices sooner, as more Americans buy homes and draw down inventory.”

Along the lines of mortgage relief, the Treasury Department this week launched a new website for consumers seeking information about the Obama Administration’s Making Home Affordable loan modification and refinancing program. The site, www.MakingHomeAffordable.gov, offers features including interactive self-assessment tools that will empower borrowers to determine if they are eligible to participate and calculate the monthly mortgage payment reductions they could stand to realize under the Making Home Affordable program.

This is a helpful site that we should all be sharing with our friends, families and clients alike.

Finally, on Friday, Jim Gillespie, president and CEO of Coldwell Banker Real Estate LLC, will participate in a discussion about the state of the housing market, live from the New York Stock Exchange on CNBC. This will occur on Friday at approximately 4:30 p.m. (Eastern).

Jim will participate on the “Roadmap to Rebound” segment hosted by Maria Bartiromo. Yale economist Dr. Robert Schiller and Sanjiy Das, CEO of CitiMortgage, will also participate.

In another powerful symbol of what our Coldwell Banker and Realogy leaders are doing on behalf of consumers and the real estate sector in general to enact change that will stimulate housing and ultimately the economy, Jim plans to call upon government leaders to enact a $15,000 non-refundable tax credit to ALL buyers and also a mortgage buy down that would bring rates to the 4-4.5% range. This, NAR reports, could generate an additional 840,000 home sales over 12 months. This home buying activity would have major implications in stimulating the overall US economy since NAR also reports that each home sold generates more than $60,000 in economic activity. The proposal would also have a greater impact on foreclosures than the current stimulus package. I hope you will all watch.

Now, with all of that exciting news for the week in tow, let’s take a look at our local real estate news:

• Boulder/Longmont—Our Boulder office reports that new listings are down 10% from the week before, but listing activity is still very busy. Sales in the second week of March increased by 23% (from the previous week). Showing activity continues to climb and based on Agent reports there are loads of buyers out there. They still are taking longer to pull the trigger than in past years, but not as many seem gripped by fear as a few months ago, as the increased rate of sales shows. Houses that are in top condition and under the median price ($539,000 in Boulder) are selling briskly, often within 10 days of listing. Our Longmont office reports that showings were off 11% from last week. We are seeing activity in the new builder market. Builders are offering some super incentives and buyers are seeing great values. We are still seeing a lot of buyers "sitting on the fence.” They are waiting for the interest rates to go down or they are waiting for the prices to decline—the problem, there hasn’t been much movement on either end. We are all waiting for the press to realize that real estate markets are local and we are not in any kind of drastic state here in Longmont.
• Conifer—Our Conifer office reports one new listing during the week. Four listings went under contract during the past week plus one buyer—one listing was under contract within one day of going on the market and one within two days. Showing activity continues strong with 34 showings during the week.
• Evergreen—Our Evergreen office reports a total of five new listings for the week. Two listings went under contract. We had 73 showings for the week plus seven Agent previews for a total of 180 thru mid-month.
• Denver Central—Our Denver Central office reports that buyers can expect to compete with other offers for ANY property priced under $250,000 in the Denver Metropolitan marketplace. There is renewed interest from buyers because of low mortgage rates, new tax incentives and an overall feeling that the Denver market has hit bottom in inventory. Anticipation is high that price increases will follow shortly.
• Devonshire—Our Devonshire office is reporting that even in these challenging times we are still setting showings at a pretty good rate so we know that buyers are out there. Buyers are very hesitant to make offers and commit to purchasing at this time as they are feeling the angst of the current economic conditions. With rates for mortgages dropping again, it may be the perfect time to buy. If sellers are pricing their homes correctly, they are selling. As real estate brokers, we continue to underscore our value as we are knowledgeable on what it takes to get transactions done. It would behoove consumers to use a full time real estate professional. We are making a concerted effort to get the good news out there when most news seems to be gloomy at best. It may be a great time to buy. Interest rates are fabulous and sellers are pricing their homes realistically at last.
• Douglas County—Our Southwest Metro office reports that our showings have increased as well as the attendance at our open houses. We have had several Agents report excellent turn out at their open houses and they have picked up buyers and listings. We had a phone call from an article regarding our community service that was run in last Sunday's paper. Our mortgage rep is quite busy and buyers are ready to start taking the steps to buy a home.
• El Paso County—Our Colorado Springs office is reporting steady sales and showing activity. We had our first VA listing cancellation due to the new government guarantee on VA loans. I suspect there will be a few more this week. Commercial financing is extremely tight and guidelines need to be checked daily. Work has stopped on the new mall at Highway 83 and Voyager due to construction financing changes.
• Larimer County—Inventory is increasing throughout Larimer County as the prime selling season inches closer. However, the market remains very price sensitive—so those sellers with super clean homes and terrific curb appeal will continue to have a leg-up on the competition. Many buyers are looking at foreclosures and short sales but due to substantial waiting periods for responses from banks, many don't have time to wait. With the change to daylight savings, we're seeing an increase in showings weekdays as buyers are able to view properties after work.
• North Metro—We have seen a big increase in activity in March so far. The lower-end market is very hot right now with multiple offers common. We are seeing increases in sales volume overall.
• Parker—Our Parker office is reporting that activity has increased and although we see more new listings on the market, the inventory did not go up because the sales activity is steady as well. Traffic through open houses was very high over the last weekend and the call volume on our listings has increased as well as an increase in showings. Sellers are now better educated through our Agents and are power pricing their homes to create more energy in the buyer pool. They also react faster to changes in the market.
• Southeast Metro—Brokers are very busy writing offers! In some cases, brokers are writing at least three offers before going under contract due to multiple offer situations. Showing activity continues to increase as we are now consistently setting over 500 showings a week. We are also seeing an upswing in traffic at our Previews properties, too.
• West Lakewood—Our West Lakewood office is reporting that open houses are very active. We had 19 groups at one home and 23 at another. It appears that many of the buyers are relocating or want to relocate from other parts of the country. Most Agents are working with from one to five sellers who are getting ready to place their homes on the market in April.

With spring break ending and the weekend weather outlook to be gorgeous, look for the first of the spring garage sales as well as lots of great homes holding open houses! For a schedule of open houses, go to www.OpenHouse.com or www.ColoradoHomes.com. Spring has sprung!

Until next week,
Make it a great one,

Chris Mygatt
President and Chief Operating Officer
Coldwell Banker Residential Brokerage Colorado

Positive Perspective, Highlighting the Upside of the Economy in a Chalenging Market

I Dream of Denver: If you jumble together the five most popular American metro areas - Denver, San Diego, Seattle, Orlando and Tampa - you get an image of the American Dream circa 2009. These are places where you can imagine yourself with a stuffed garage - filled with skis, kayaks, soccer equipment, hiking boots and boating equipment. These are places you can imagine yourself leading an active outdoor lifestyle. read more here http://www.nytimes.com/2009/02/17/opinion/17brooks.html?_r=1&emc=eta1

Homebuilders a bit more upbeat: Index shows that builders were slightly more optimistic in February compared to January. read more here http://money.cnn.com/2009/02/17/real_estate/builders.reut/index.htm

Colorado foreclosures fall in 2008 for 1st time in years: Colorado foreclosure activity fell last year for the first time since the state began collecting data in 2003, according to a report released Monday by the Colorado Division of Housing. read more here http://denver.bizjournals.com/denver/stories/2009/02/23/daily4.html?surround=etf

S&P: Denver had smallest 2008 home-price decline of 20 U.S. cities: The monthly S&P/Case-Shiller Home Price Indices said average prices of existing homes in Denver fell 4 percent between December 2007 and December 2008, less than any of the other 19 cities in the report. read more here http://denver.bizjournals.com/denver/stories/2009/02/23/daily22.html?ana=e_du_pap

Weld stands tall among nation's agriculture counties: LA SALLE - Despite encroaching suburbia, Weld County this year remains among the top 10 places in the nation in agricultural production. A federal census report conducted every five years ranks Weld as the No. 8 agricultural county nationally, with a market value for its products at $1.54 billion. read more here http://www.denverpost.com/ci_11809432

Denver Zoo earns environmental recognition: The Denver Zoo has become the first zoo in the United States to earn an ISO-14001 certification for the entire zoo. The certification is the international standard for environmental management systems. The certification by NSF International is considered an honor, Denver city officials said today. read more here http://www.denverpost.com/search/ci_11834843

Denver ranks 7th on EPA list of most energy-efficient buildings: Denver ranks No. 7 among U.S. cities with the most buildings rated highly energy efficient by the U.S. Environmental Protection Agency under its "Energy Star" program. read more here
http://www.bizjournals.com/denver/stories/2009/03/02/daily31.html?ana=from_rss

Facing Foreclosure – Should You Sell Short?

Facing Foreclosure – Should You Sell Short?
By Rovena Flores

Facing foreclosure is one of the most difficult situations in which homeowners can find themselves. As the default notices pile up, a decision looms ahead: should you accept foreclosure, or attempt to do a short sale? Up until recently, it’s probably safe to say that you may not have even heard of the term “short sale,” let alone what is involved. For that reason, many homeowners have let their home be foreclosed on, not knowing that they have options. After all, the decisions you make in this difficult situation now will affect you for years to come.

A short sale is when a bank agrees to take less for the sale of your home than you owe on the mortgage. It is not for everyone of course. There are a few criteria you must meet if you are interested in exploring this option.
• The value of your home has dropped. As the prices of homes fall, it’s not unusual for a homeowner to find themselves owing $300,000 on a mortgage for their now $250,000 house. If a bank believes it can avoid less of a loss and receive at least a portion of what is owed on the mortgage, they will consider selling the property short rather than putting it into foreclosure.
• You have fallen on hard times. You will need to write a letter explaining your hardship and why you will not be able to pay the difference between what you owe on your mortgage and what you will sell the home for. Examples might include; unemployment, bankruptcy, death in the family, medical emergency or sudden illness and divorce.
• You have little or no assets. Your current finances need to support your hardship. The lender will likely look into your financial situation and if it finds that you owe other real estate, stocks, bonds or have cash in your savings account, the lender will likely determine that you can pay them back the shortfall.

Don’t be fooled of course. This won’t be an easy process. A buyer must first make an offer on your home before you will be allowed to qualify for a short sale. So even if you meet all the other criteria, it is dependent on the lender accepting the buyer's offer. If the offer is rejected, a short sale will not take place.
You’re also not going to walk away scot-free. There are consequences just as there are with foreclosures. If the lender does agree to the short sale, you may be issued a 1099 tax form for the forgiven debt and forced to pay taxes on the shortfall. For example, if the bank receives $250,000 for the sale of your home but you owe $300,000, the bank will consider that $50,000 a gift and you may be taxed.
However, the Mortgage Forgiveness Debt Relief Act of 2007 generally relieves homeowners of any potential tax liability for the shortfall, if the home was used as a primary residence. The provision applies to up to $2 million in debt forgiven through 2012. Due to the potentially complicated tax issues, you should speak to a real estate lawyer and/or a tax accountant to determine the amount of consequences you could face with to a short sale.
Just like a foreclosure, a short sale will show up on your credit report. It is considered a pre-foreclosure that has been redeemed. While that may not seem as bad as having a foreclosure on your record, it will affect your credit rating 200 to 300 points, which is identical to a foreclosure reporting.
The biggest difference between a short sale and foreclosure is how long you have to wait to buy again. Chances are you will be anxious to begin rebuilding your future by getting back into the real estate market as soon as possible. If you let your home foreclose, you may have to wait up to seven years to buy again. With a short sale, the waiting period is two years. But, if you were never more than 60 days late with a mortgage payment, you may buy immediately. It’s yet another important reason to not get behind on your payments. Even if you are in the process of default, continuing to pay your mortgage can get you into a new home sooner rather than later.

The first step to take is to build a team to support you. Find a local real estate agent who is educated about and has experience in working with foreclosures short sales. For instance, a brokerage like Coldwell Banker Residential Brokerage has trained many of its agents in short sales to ensure clients receive the expertise and quality service they deserve. Your agent should be able to help guide you in the process, but will not be allowed to give you legal advice. For that, you will want to consult legal council to make sure you are protected. Taking the right steps now may be difficult, but may set you in the direction of making a full recovery.
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Rovena Flores

Avon Walk for Breast Cancer Rocky Mountains

Coldwell Banker
With Avon Walk for breast cancer rocky mountains

Coldwell Banker Relocation employees Ashley Wilson, Nancy Frank, Amber Baca and Debi
Thompson are walking in this years’ Avon Walk for Breast Cancer/ Rocky Mountain and have teamed up with the Colorado Avalanche to bring you a great promotion to help
fundraise for their team. They will be walking a grueling 39.3 miles, starting in Keystone and ending in Breckenridge which will take place over the weekend of June 27-28. A portion of each ticket sold through this promotion for the Avalanche game that night will go towards
their team fundraising effort. If anyone would like to donate in support they can visit the team website at www.AvonWalk.org/goto/CBRelo

Thursday, April 9th
7:00 p.m. @ Pepsi Center

Dallas stars vs. Colorado Avalanche
Coldwell / Avon Walk
PRICING
$65 Lower Level & Club Level
(Face value from $115-$94)
$30 Upper Level Corner
(Face value from $40)


TO ORDER:
Visit: www.pepsicenter.com/groups/avalanche/coldwellbanker
Or call Nate Christiansen at 303.405.1328

Special Ticket Prices for Elitches

JOIN US FOR THE ELITCH GARDENS FUNDRAISER
SPRING SPIN: ONE GOOD TURN TO BENEFIT ANOTHER™
SUNDAY APRIL 19th, 2009 ¨ 10:00 a.m. to 6:00 p.m.

We’re putting the FUN back into FUNdraising! Be among the first to enjoy Colorado’s premier theme park while helping us raise funds for our nonprofit organization.

TICKETS JUST $19.99

(less than last year!)
Children 3 and under and Adults 70 and over are FREE


We have been selected for the third year in a row as one of several groups participating in the sale of admission tickets to the fundraiser Spring Spin: One Good Turn To Benefit Another™ held in conjunction with the Park’s opening. Every year we've had a blast and we look forward to having you join in the fun with us this year!



Each ticket we sell earns $5 for Xylem Family Resource.



The more tickets we sell, the more money we raise.



Our goal is to sell at least 200 tickets this year. Help us reach our goal!



Two regular season tickets will be presented to the individual who purchases the most tickets for this event!!!! So, ask your friends, family, neighbors, and coworkers to join you in purchasing tickets for this special day!!!!



Purchase your tickets today! or by April 10.

Contact: info@xylemfamily.org or 303.756.0951

Your Spring Spin™ ticket includes:

· A chance to enjoy a private day for nonprofit organizations.

· A full day of unlimited rides with few lines.

· Spectacular shows and incredible attractions.

· A special FREE ticket to revisit the park any day between September 1 and November 1, 2009 (attached to your Spring Spin ticket)

· Turn your ticket into a Season Pass for only an additional $34.99. That's almost $25 in savings for a season full of fun (upgrade is purchased the day of the event at the park). This offer is valid only on the day of the event (April 19, 2009) and is the best price of the season.

For more information on Spring Spin visit http://www.springspin.com/events/elitchgardens

Special Ticket Prices for LaCrosse

First Time Home Buyers Tax Credit

Congress Enacts Bigger and Better
Home Buyer Tax Credit!

A tax credit of up to $8,000 is now available for qualified first-time home buyers purchasing a principal residence on or after
January 1, 2009 and before December 1, 2009.
Unlike the tax credit enacted in 2008, the new credit
Does Not Have to be Repaid.

Contact Rovena for Details and
to find the home that meets your needs. Call Today!

Going Green

Spring Ahead

Parade of Homes