Even in Greater Baton Rouge, where home prices have not fallen as much as elsewhere, some who would like to move have put their plans on hold until things are a little better for sellers. In a buyer’ s market, a real estate agent often has to deliver the bad news that the seller has to lower their asking (and selling ) prices a bit to be in line with the market. The new Home Buyer’s Tax Credit promises to shake things up for sellers as well as buyers.
The Home Buyer’s Tax Credit offers you a chance to reassess your position. Now, repeat buyers who have lived in their home for at least five of the last eight years qualify for a $6,500 tax credit. If you have been thinking of making a change the credit allows you to do that. Why?
First of all, if you have a home priced under $250,000 in most parts of the country, your home is on the radar screen of many first time buyers. True first time buyers who have never owned a home tend to be younger and not as affluent, for them, so an affordable home might be just want you want to sell. In, home at these price points are selling much faster than last year. If you want to sell, you might not only find a buyer, you might get multiple bids on your home.
Second, if you have been wanting to move, the $6,500 might give you the help you’ve need. This will offset the closing costs, partly compensate you for any loss in value, or give you some working capital for projects in the new house.
Third, when you are house shopping, you will also have the “buyer’s market advantage” on your side and be able to get more house for your money. If you are looking for a bigger, better house, the seller may have lowered the price to meet the market. With low interest rates currently offered , you might be able to find your dream at such a deal you fell less pain at how much you had to lower your price.
Fourth, the credit is called a move-up credit, but you don’t have to buy a more expensive home to qualify for the $6,500. If you are looking to downsize due to retirement or a lifestyle choice to simplify, you find a new place that costs less and still get the tax credit.
Fifth, if you’ve been wanting to turn your home into a rental, this could be your chance. Current interpretations of the new law do not prohibit you from keeping your current home as investment property any buying another for yourself as the primary residence.
Sixth, this credit could give you a chance to revisit a prior decision. Say you moved north for a job, but now, a few years later, you realized you miss the Prairieville or want to be closer to your kids. If you have rented for more than three years, you can use the First Time Home buyer’s Credit to buy a new home or condo up North. If you bought and have lived in your home at least five of the last eight years, you can sell and buy elsewhere with the $6,500 bonus. You can even turn your current home into vacation home status, buy a primary residence and claim the credit. (For some of these trickier scenarios, make sure to consult your tax advisor.)
The purpose of the new credit to is to stimulate the housing market at all levels, although homes that sell for over $800,000 won’t qualify. Since the credit is expected to cost the government $10.8 billion in lost taxes (plus $10 billion for the first phase), it is highly unlikely that it will be renewed. As the time lines roughly correspond to when interest rates are likely to remain low, this next five + months are the perfect example of a “once in a lifetime opportunity” for you as a seller to move your home.
The new credit can work for you! Let Sandy and her team show you a wide selection of beautiful new and pre-owned homes in the Greater Baton Rouge area, including Baton Rouge, Prairieville, Gonzales, Denham Springs, Watson, Walker, Central, Greenwell Springs, Zachary, Baker, Port Allen, Brusly, Geismar, and St Amant. We can also you answer any questions you might have about the home buyer's tax credit - $8,000 first time buyers or $6,500 for repeat buyers.