The massive economic rescue bill enacted into law last month includes a provision to help military families forced by deployment or other eligible circumstances to sell their houses at a loss in today’s down market. Under the provision, the federal government will cover 95 percent of a loss. The law applies to service members with mortgages entered into before July 1, 2006. An online resource from the U.S. Department of Defense can help you learn if your client is eligible for the assistance. For more info contact Megan Booth at 202-383-1222.

Reprinted from Bay East Association of Realtors

If you’ve looked at the Gables End development in Mountain View, you might be interested to know that they’re down to the last home in phase 6. They will be entering a new phase soon.

The new homes at Mission Estates, just off of Mission Blvd at 680 (northern exit for Mission) are now selling. In addition to the floorplans that have been modeled, there are expanded versions of those floorplans being built. We can take you into the sales office and help you make sense of it all, and we can help you negotiate a purchase in the development. Call us to take you over there!

The Internal Revenue Service (IRS) recently issued new guidelines and clarified documentation that taxpayers must submit to successfully obtain the federal tax credit for home buyers.

The federal tax credit for home buyers was extended and expanded late last year. Qualified first-time buyers may be eligible to receive a tax credit of up to $8,000 on homes purchased before April 30, 2010. Repeat buyers may be eligible for a tax credit of up to $6,500. Click here for more information about the federal tax credit for home buyers, including eligibility requirements.

To receive the tax credit, home buyers must comply with the IRS’s documentation requirements, including a fully executed IRS Form 5405. On the form, which is available on the IRS’s Web site, taxpayers provide information supporting their claim of eligibility, such as income and home purchase date.

The IRS also requires home buyers to submit a copy of the closing or settlement statement that proves the transaction took place. The IRS previously said that the statement should show “all parties’ names and signatures, property address, sales price, and date of purchase.” However, since closing or settlement statements vary by state, and in some cases the form does not include both the seller’s and buyer’s signatures, the IRS has revised this requirement. As long as the closing or settlement statement conforms to prevailing local practices, the IRS will accept it.

One stipulation for repeat buyers is they must provide documentation they lived in their former property for a consecutive five years out of the previous eight years. Accepted documentation may include property tax records, hazard insurance records, or copies of annual mortgage interest statements filed with their federal taxes.

From February 25, 2010 C.A.R. Newsline
Reprinted with permission of the California Association of Realtors

A recent report shows that one in five U.S. homeowners owed more on their mortgage than their home was worth in the fourth quarter; however, California’s housing market is bucking the national trend and is telling a different story.

WHAT THIS MEANS FOR CALIFORNIA HOMEOWNERS

Although the report by Zillow.com claims that the percentage of American single-family homes with mortgages in negative equity rose in the fourth quarter, the report does not account for seasonal changes. The traditional home-buying season is April through August. Historically, this time period also is when median home prices rise. In September, median home prices generally show a declining trend, and remain steady from November through February. The change in the median home price noted by Zillow.com is a typical year-end seasonality adjustment in price.

Unlike the national median home price, the month-over-month changes in California’s median home price for 2009 were stronger than the long-run average. Low interest rates and tax incentives led to a rise in the demand for housing. As a result, housing inventory was constrained and created upward pressure on home prices.

California’s housing market has shown signs of stabilization since early last year. Sales of existing, single-family homes bottomed out in August 2007, and the median home price reached its trough in February 2009. In December, California’s median home price was 25.1 percent above the low for the current cycle.

In December, the median price of an existing, single-family home rose to $306,820, an 8.4 percent rise year-over-year, the second consecutive year-over-year increase, and the 10th consecutive month-over-month increase, according to C.A.R.’s December sales and price report.

Although home buyers should not focus solely on future home price appreciation, homeowners who purchase a median-priced house, live in their home for at least five years, and sell it at the then current median price, have averaged an annual rate of return of more than 11 percent, according to data collected by C.A.R. over the last 40 years.

From February 11, 2010 Market Matters Weekly
Reprinted with permission of the California Association of Realtors

In the current climate of short sales and loan modifications, many homeowners feel like the deck is stacked against them when they try to talk to their lender, but they can’t quite articulate the factors that have created the disproportionate bargaining power. Check out this video for a great explanation of the situation when it comes to IndyMac loans.

Valley Terrace is full of opportunities, and here is a new one — a 2 bedroom/2 bath condo for $150,000. This is a short sale and we have already opened discussions with the primary lender. Let us know if this one interests you!

5025 Valley Crest Drive, #137, Concord

When trying to figure out what you can do about your overbearing mortgage, it is extremely helpful to know if Fannie Mae or Freddie Macx owns it. Fannie and Freddie loans are eligible for various programs, including a Home Affordabel Refinance. To find out who owns your loan, check out makinghomeaffordable.gov.