You Don't Have to be a First-Timer to Take Advantage of the New Home Buyer Tax Credit

The first-time home buyer tax credit, that Realtors have reported jump-started home sales this Summer and Fall, but due to expire at the end of this month, has been extended through April 30, 2010 by Congress and is on its way to President Obama for his promised signature.

The extension expands eligibility for the home buyer tax credit to people with higher incomes as well as to people who have already owned a home for at least the past five years. In either case, the buyer must sign a purchase contract on or before April 30, 2010 and close on the purchase by June 30, 2010. The $8,000 maximum first-time buyer tax credit will continue but will now be available to individuals with incomes up to $125,000 and joint filers with annual incomes up to $225,000. Home buyers with incomes up to $145,000 and couples with incomes up to $245,000 will be eligible for somewhat reduced tax credits.

Under similar income limits, a $6,500 maximum tax credit will be available to people who already own a home and want to move up to a larger home.

Under the new income limits, two-thirds of all American families owning a home today may be eligible to buy a new home. While buyers will not be required to sell their current home to qualify, the tax credit must be used to buy a new "primary residence", not a vacation home or investment property.

To keep speculators out of the program, people who claim the credit but then sell the home or no longer use it as their primary residence within three years will be required to repay the credit. The intent is to exclude from the program speculators who might purchase a home intending to flip it for a fast profit, according to Max Baucus, chairman of the Senate Finance Committee.

Here's a "heads-up" to those who may have considered buying a first home under the prior program but didn't quite get around to it.

"Contact a Realtor and get started now. You only have until April 30, 2010."

Congressional legislators in both houses have indicated that this costly part of the stimulus program will not be extended a second time. Critics point out that only about one-fourth of the homes purchased under the prior program would not have been bought anyway without the costly tax-credit program. There are also concerns that the previous tax credit program encompassed high numbers of fraudulent transactions. In this version of the program, the Internal Revenue Service has been given much wider authority to oversee the process to root out fraud.

If you are considering buying a first home or moving up to a larger home in the Tampa Bay Florida area I invite you visit my Tampa Real Estate website or for more immediate service, contact me by phone at 813-263-6806. I would be delighted to answer any questions you have.

Tampa September Home Sales Statistics Are Encouraging

The following update on Tampa area real estate sales was recently issued as a news release by the Greater Tampa Association of REALTORS® (GTAR)

"With negative news emanating from virtually every area of the economy, September real estate statistics in Hillsborough County offer encouragement for the local market.

"In statistics released by the Greater Tampa Association of REALTORS® (GTAR) and the Mid-Florida Regional Multiple Listing Service, two important figures, total home sales and inventory of homes on the market, improved in September over the previous month. Sales rose to 1,345 last month, up slightly from the 1,327 sold in August. The number represents the highest monthly sales in the county since June, when 1,394 homes sold.

"The inventory of homes on the market in Hillsborough County dipped to 14.21 months, down from 14.68 months in August, the lowest inventory figure since June of this
year, but more significantly, the second lowest figure since December, 2006, when the
figure stood at 9.04 months.

“Most economists believe our recovery will be slow and steady,” says Carol Austin, CEO of GTAR, “and these latest figures, while not dramatic, reflect that forecast.” Deborah Farmer, President of the REALTOR® association, believes the latest statistics offer more hope for the real estate market in the future. “The fact that inventory levels are down significantly since the beginning of 2008 is a number that should not be overlooked,” she noted. “The January 2008 inventory stood at nearly 26 months. To see that figure at its current level is more than encouraging,” Farmer said."

My belief is in line with these thoughts. The Tampa and Tampa Bay real estate market is beginning to show real signs of life again. The $8,000 first-time home buyer tax credit has helped drive this upturn and it seems likely to me that Congress will extend, and may even expand, that program in 2010.

As it starts getting colder up North, it's time to start looking for that primary or seasonal home you've been wanting here in warm, sunny and inviting Tampa Bay Florida. Don't miss out on the current very attrative price levels. Prices will inevitably start moving up again as the economy improves and the inventory of unsold homes on the market contiues to fall.

Outdoor fun in New Tampa

Bicycle Riding is great in Tampa Bay
In my opinion, there is no better exercise for kids and adults than biking. And, there are many opportunities for bicycle riding in the Tampa Bay area. Whether you are interested in riding on the road or off-road trail riding, you can ride year round in west -central Florida. Local clubs schedule organized rides ranging from rides with just a few to hundreds of riders. The Tampa Bay Freewheelers lists several weekly rides for different skill levels and have longer organized rides with hundreds of participants. The Tampa Bay Freewheelers is sponsoring their Hilly Hundred Ride on October 18 2009, with varying distances of up to 100 miles and several hundred riders. Team New Tampa and Team Grupetto are other Tampa area groups dedicated to road biking. The SWAMP Mountain Bike Club is “an Organization of off-road cycling enthusiasts who share in the fun and excitement of Florida Mountain Biking”.
New Tampa has a great places to ride called Flatwoods Park, a Hillsborough County Recreation maintained park with miles of off-road trails for mountain biking and a seven mile paved loop road for road biking, skating, walking and running. In the Tampa area, hills are something we do not have too much of. Tampa bike riders looking for hills can travel to nearby San Antonio, FL. A local bike shop (San Antonio Cyclery), put out this map San Antonio, FL showing several hilly routes (40, 50 and 60 mile options).
New to biking? you might want to read Bicycling Street Smarts by John C. Allen. Need to buy a bike? Bicycle Magazine has a review of entry level bikes.

Want more information on Tampa and Tampa Bay ? May I invite you to visit my Tampa real estate and lifestyle website.

A Magical Hidden Property For Sale in Tampa Bay

MAGICAL is the word that describes this hidden property.

Calling old-time Florida lovers, this 7 acre tract in Hudson Florida, is a hidden time machine. The words tranquil, lush, wondrous describe this land.

Once you step on this property you will experience a transition to old Florida. Grand majestic oaks and enormous pines cover this private park. Own a magical piece of Florida, as this property has 3 fresh water springs. The property is mostly fenced.

Located close to the Hudson Marina, Hudson Beach, Hudson Elementary school, grocery stores and Bayonet Point Hospital. Owner financing is a possibility. Call to walk this property today. And, it is yours today for just $139,900. Call Cheryl Stimac, Broker at Red Shoe Realty, Inc. today at 813-263-6806 or cheryl@cherylstimac.com

Extend the Home Buyer Tax Credit - Yes or No?

Capitol Hill may be vacant right now as Senators and Congressmen are home listening to their constituents, but real estate and home builder lobbying group[s are actively working on a full-bore campaign to extend the $8,000 first-time home buyer tax credit currently scheduled to expire on November 30, 2009.

As you may know, the American Recovery and Reinvestment Act of 2009 (the stimulus package) authorized a tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence between January 1, 2009 and November 30, 2009. The program has been quite successful in reducing the inventory of unsold homes while helping many afford to buy a first home.

The National Association of Home Builders (NAHB) and the National Association of Realtors (NAR) are both hoping to persuade Congress to pass legislation to extend the tax credit as soon as possible after Congress returns to Washington next week. The two associations are contacting members of Congress even while they are in their home districts during their congressional recess. One of the things they are pushing for, in addition to an extension of the first-time home buyer credit, is to expand the program to cover all home buyers through the end of 2010.

Senate Majority Leader Harry Reid recently indicated that he believes “it's something we can get done.” Senate Banking Committee Chairman Democrat Chris Dodd and Republican Johnny Isakson are sponsoring a bill that would extend the credit through 2010 and expand it to a $15,000 maximum. In the House, two bills have been introduced to extend and expand the credit for either 6 or 12 months. Both the NAR and the NAHB organizations are strongly supporting these initiatives.

With this impetus, it seems likely that in one form or another, the tax credit will be extended into next year, but...

As we've come to understand, there is no such thing as a "sure thing" in Washington. NAR spokesman Walter Molony recently justified his organization’s support for the tax credit saying that it is reducing the inventory of unsold homes and stabilizing pricing, benefiting the economy since in his judgment house prices “overshot to the downside.” But, the NAR also estimates that 1.8 million to 2.0 million first-time buyers will take advantage of the $8,000 first-time home buyer tax credit before the current version expires. the program, as it now exists is expected to cost about $15.20 billion.

Viewed another way, NAR's own estimate is that only 350,000 of the homes sold under the program would not have been sold without the tax credit. If you now divide the $15.2 billion the program cost by only those 350,000 homes that would not have been sold without it and you get a whopping $43,000 per additional home sold. And, critics say, the numbers will only get worse if the program is extended and expanded to cover all home buyers.

These opposing views of the program could lead fiscal conservatives in both the Democratic and Republican parties to complain that any extension will only add to the ballooning national debt. Legislation that looks, at any given moment, as if it will clearly be enacted can be delayed, watered down, or frustrated in the House and filibustered in the Senate.

So, if you are in the market for a home, and particularly if you haven't owned a home in the past three years, so you qualify for the current $8,000 tax credit, you should be working with a Realtor like Cheryl Stimac, a competent and honest Tampa Florida real estate expert right now to buy the home you've been wanting so you can close on it before the November 30th expiration of the current program.

If you aren't already involved in buying a Tampa Bay home of your own, E-Mail Cheryl or call her at Red Shoe Realty, Inc at 813-263-6806 right away and get started toward owning your piece of the Tampa Bay, Florida paradise.

$1.8 Billion in Education Stimulus Money Coming to Florida

The U.S. government recently released $1.8 billion in stimulus money for education to Florida, shortly after the state applied for a waiver required because the state has underfunded education in previous years.

"The $1.8 billion Florida is receiving is part of the single largest boost in education funding in recent history," Secretary of Education Arne Duncan said in a statement. 'Florida can now utilize these funds to save jobs and lay the groundwork for a generation for education reform."

Although the money is expected to plug holes in school-district budgets to save jobs, some of South Florida's school districts may still see some layoffs. School districts won't get the funds directly from Washington. Florida law makers, confident the state would get the money, allocated these funds to shore up the education portion of the 2009-10 budget the Legislature approved last month. That allowed legislators to tout a small increase in per-student spending in Florida.

In addition to the $1.8 billion in stabilization funds, Florida has received almost $600 million more in education stimulus dollars -- including about half the money the federal government designated for low-income schools, programs for disadvantaged students and other grants.

Another $891 million in stabilization money will also become available later this fall.

To receive the funds, the state had to assure the federal government that it would closely track education statistics, including annual student improvements, the effectiveness of state standards and assessments, and interventions in turning around under performing schools. The state will also be required to report how many jobs are being saved with the stimulus money, how the funds are used, and what state and local tax increases were avoided because of the federal dollars.

While all this spending may seem to be a mixed bag of benefits and downsides, there is little doubt that this infusion of money will help improve the schools around the state and here in Hillsborough and Pasco counties.

If you would like more information on any aspect of life here in Tampa Bay, feel free to E-Mail me with your questions or visit my Tampa Bay Florida real Estate website.

Foreclosure VS Short Sale

HELPING HOMEOWNERS IN DANGER OF FORECLOSURE

RED SHOE REALTY has earned the Certified Distressed Property Expert (CDPE) designation, having completed extensive training in foreclosure avoidance and short sales. This training will mean a lot to us to be able to help homeowners that may be facing the foreclosure process.

A Short Sale allows a homeowner to repay the mortgage at the price that the home sells for, even though it is lower than what is owed on the property. With plummeting property values, this can save many people from foreclosure and even bankruptcy. More and more lenders are willing to consider short sales because they are much less costly than foreclosures.

In the Tampa area, thousands of homes are in danger of foreclosing. It is happening in all price ranges. Local experts say that even high-priced homes are not immune.

“My training and experience in dealing with lenders in negotiating short sales will be invaluable as I work with sellers and lenders on complicated short sales”. Our focus in this is to help homeowners who may feel paralyzed by their circumstances.

The Distressed Property Institute training in short sales can offer the homeowner much better alternatives to foreclosure, which virtually destroys the credit rating. Having this training allows me to better understand market conditions and can help sellers through the emotional experience.

“Our goal is to help as many homeowners as possible”.

The following chart compares the implications of going through a foreclosure with the implications of a short sale. I have also copied an article from the Wall Street Journal (June Fletcher, November 22, 2008) that illustrates some of the complexities of dealing with foreclosure compared to a successful short sale. (I hope you don’t have 12 properties in foreclosure.)

	Foreclosure VS. Short Sale Homeowner Consequences
Issue	Foreclosure	Successful Short Sale
Future Fannie Mae Loan Primary Residence	A homeowner who loses a home to Foreclosure is ineligible for a Fannie Mae backed mortgage for a period of 5 years.	A homeowner who successfully negotiates and closes a short sale will be eligible far a Fannie Mae backed mortgage after only 2 years.
Future Fannie Mae Loan Non Primary	An Investor who allows a property to go to Foreclosure is ineligible for e Fannie Mae backed investment mortgage for a period of 7 years.	An investor who successfully negotiates and closes a short sale will be eligible for a Fannie Mae backed investment mortgage after only 2 years.
Future Loan with any Mortgage Company	On any future 1003 application, a prospective borrower will have to answer YES to question C in Section VIII of the standard 1003 that asks “Have you had property foreclosed upon or given title or deed in lieu thereof in the last 7 years?” this will affect future rates.	There is no similar declaration or question regarding a short sale.
Credit Score	Score may be lowered anywhere from 250 to over 300 points. Typically will effect score for over 3 years.	Only late payments on mortgage will show and after sale, mortgage will be reported as paid or negotiated. This will lower the score as little as 50 points if all other payments are being made. A short sale’s affect can be as brief as 12 to 18 months.
Credit History	Foreclosure will remain as a public record on a person's credit history for 10 years or more	Short sale is not reported on a credit history. There is no specific reporting item for “short sale”. The loan is typically reported “paid in full, settled”.

	Foreclosure VS. Short Sale Homeowner Consequences
Issue	Foreclosure	Successful Short Sale
Security Clearances	Foreclosure is the most challenging issue against a security clearance outside of a conviction of a serious misdemeanor or felony. If a client has a foreclosure and is a police officer, in the military, in the CIA, Security, or any other position that requires a security clearance, in almost all cases clearance will be revoked and position will be terminated.	A Short Sale on its own does not challenge most security clearances.
Current Employment	Employers have the right and are actively checking the credit regularly of all employees who are in sensitive positions. A foreclosure in many cases is ground for immediate reassignment or termination.	A short sale is not reported on a credit report and is therefore not a challenge to employment.
Future Employment	Many employers are requiring credit checks on all job applicants. A foreclosure is one of the most detrimental credit items an applicant can have and in most cases will challenge employment.	A short sale is not reported on a credit report and is therefore not a challenge to employment.
Deficiency judgment	In 100% of foreclosures (except in those states where there is no deficiency) the bank has the right to pursue a deficiency judgment.	In some successful short sales it is possible to convince the lender to give up the right to pursuit a deficiency judgment against the homeowner.
Deficiency Judgment (amount)	In a foreclosure the home will have to go through an REO process if it does not sell at auction. In most cases this will result in a lower sales price and longer time to sale in a declining market. This will result in a higher possible deficiency judgment.	In a properly managed short sale the home is sold at a price that should be close to market value and in almost all cases will be better than an REO sale resulting in a lower deficiency.

Wall Street Journal November 22, 2008
Short Sale vs. Foreclosure
In default and underwater on 12 properties, a reader wonders if selling at a loss is any better than just walking away

By JUNE FLETCHER

Q. I am in default on 12 jointly-owned properties that I am trying to liquidate as part of a divorce. All of my properties are currently worth less than the mortgage balances, due to the tough real estate market. I am aware that I will likely be taxed for the amount of the mortgage I had that is not satisfied by any particular short sale. It seems that this would not be the case if the house is foreclosed on, or becomes bank-owned.
This almost encourages homeowners to allow foreclosure, rather than to participate in helping to sell the property (when there is no equity left), because there is not "an amount forgiven" to be taxed on. I recognize that the benefit of short-sale is to lessen the effect on one's credit report, but if a homeowner is already missing payments, how much worse will a foreclosure look?
A. Although you own an unusual number of homes, your dilemma in trying to choose between a short sale and a foreclosure is, sadly, not at all unusual these days. So I asked Craig Watts, public affairs manager of Fair Isaac Corporation in San Francisco, to comment on your case. Fair Isaac is the company that created the FICO score, used by lenders to assess borrowers' creditworthiness.
Mr. Watts said that the company assesses every negative on a credit report by three factors: recency (how recently did the negative event occur), severity (how late is the payment) and frequency (how many times you've been reported delinquent on credit obligations).

A recent bankruptcy does the most damage to your score. Mr. Watts adds that if lenders are reporting all of your mortgages as in default, the damage to your FICO score would be akin to declaring bankruptcy on all 12 accounts. For more information on credit scores and how they are calculated, visit the "credit education center" at http://www.myfico.com/.
Although a short sale, where the lender agrees to take less than owed on the mortgage, will drop your FICO score as much as a foreclosure will, there is one advantage to it: You may be eligible to buy a home with an institutional loan backed by Fannie Mae or Freddie Mac more quickly than you would if it went into foreclosure. Lenders encourage short sales over foreclosures because they generally net more from them, since foreclosures incur additional marketing, legal, processing and carrying costs. (For details, see Fannie Mae's announcement 0-82.) Borrowers can be considered for loans following a short sale aftter 24 months, if the sale was caused by extenuating circumstances outside of a borrowers' control, or 48 months if it was the result of financial mismanagement on the borrower's part, according to Freddie Mac public relations director Brad German.
As for your tax situation: because of the Mortgage Forgiveness Debt Relief Act of 2007 and the recently passed Emergency Economic Stabilization Act, you can exclude up to $2 million of income ($1 million if married filing separately) from debt that's discharged through mortgage restructuring, or that's forgiven in connection with foreclosure, for the years 2007 through 2012. The exclusion must be connected with a decline in the home's value or the taxpayer's financial condition, and only applies to a principal residence, not investment properties. You can claim relief on your principal residence through IRS form 982. However, Mike Martin, a financial consultant and tax advisor in Independence, Mo., notes that there may be other provisions in the law that can help you: For instance, if you are insolvent when your debt is cancelled, some or all of that debt may not be taxable.
Given the complexity of your situation, please don't try to resolve this situation on your own: Seek professional tax and legal advice.

Why Conserve Water

To some of us, Florida seems to be a land with unlimited water resources, but
closer examination shows that this is not the case. Population growth has been tremendous in all of Florida and especially in the Tampa Bay area. Early in our history, water supplies were very inexpensive and were located in or close to our towns. As our area grew, we used up our cheap and near–by water supplies. Early in the 20th century, withdrawals in Tampa and Saint Petersburg caused saltwater intrusion and therefore further reduced the locally available supplies. This caused the cities to reach out into rural areas for their water. In the Tampa Bay area, water supplies were either obtained from large inland area well fields or from the Hillsborough River. Initially, we thought that large well fields were a perfect solution, the water was cheap, excellent quality, and had the added benefit of drying out swamps.

As ground-water withdrawals increased and we began to better understand the environmental value of wetlands, the impacts to lakes and wetlands from the regional pumping became devastating. Hundreds of acres of wetlands and dozens of area lakes were dried out. As the City of Tampa’s water needs increased, pumping from the Hillsborough River increased to a point where the City took all of the flow in the river. Consequentially, during some times of the year, no fresh water was allowed to flow over the dam to Tampa Bay. As the City’s pumping increased and we better understood the environmental impacts to the Bay from reducing the fresh water inflows, we recognized that the river and the bay were being harmed by loss of estuary habitat. The bay depends on a steady clean freshwater diet to create the highly fertile nursery areas and low-salinity habitats that the estuary’s ecosystems and sport fisheries. The impacts to the lower river and the bay were aggravated by storm-water pollution.
All of these man-induced problems caused by over-pumping are aggravated by the variable nature of rainfall. Although Florida gets about 50 inches of rainfall on average, in some years we get less than 40 inches and in some years more than 60. In the less than 40 inch years, we see more impacts from pumping and in the more than 60 inch years we see flooding.

So Why Conserve? Conserve water not just because we need more water to fuel our growth, but because we need more water to fuel ourselves, (people who already live here). We have to develop alternative sources of water both for more people to move here and because we have to change some of the existing sources that are hurting our natural environment. But Why Conserve? Because conservation is one of the least expensive sources of water possible today. Other alternative sources (desalination, other surface waters, reclaimed water, and long distance pipelines) are much more expensive than conservation. In the same way that energy conservation allows a city or utility to postpone building a new generating plant, water conservation allows us to forego construction of a new and likely much more expensive water supply.

What is meant by Conservation?
Modern water conservation simply means being more efficient in using water so that we can do all the things that we want to do with water, but do them with much less water. We want to plant landscapes that require little or no irrigation but still are lush and green and pleasant to look at. We want to install highly efficient plumbing features (toilets, shower and sink faucets, outside irrigation controllers) in our new homes (and retrofit our older homes) so that we use less water for the same purposes. If you buy a new home in our area, your home will most likely have very high efficiency plumbing. If you buy a resale older than 15 or 20 years old, you could benefit from installing higher efficiency plumbing fixtures.

Much of the hard part or work of conservation is mental. We have to change how we think of water from a cheap plentiful unlimited resource to a scarce extremely limited resource. One of the best tools for conservation is inclined or increasing utility rate. Under an inclined rate we pay more per gallon for our water the more we use. For the first 1000 gallons per month we might only pay $2 or $3 per 1000 gallons, but for the next 1000 gallons per month the rate is increased to $4 or $5 per thousand.