NHLA Blog

Here's the latest we are hearing...

1. The tax credit would be $8,000 for first-time home buyers and $6,500 for move-up buyers from December 1, 2009 to April 30, 2010 and the transaction would have to close by June 30, 2010.

2. Move-up buyers will be eligible, so long as the home they are leaving has been used as their principal residence for 5 years or more.

3. The income limits for both first-time home buyers and move-up buyers would be $125,000 for single return and $225,000 joint return.

4. Cost of the home may not exceed $800,000 to be eligible.

5. For purchases made in 2010, taxpayers would be able to claim the credit on their 2009 income tax return.

6. Home buyers would not have to repay the credit, provided the home remains their principal residence for 36 months after the purchase date.

7. The amendment includes a military waiver provision, meaning the recapture provision would not apply in the case of a member of the Armed Forces, military intelligence or Foreign Service who is on qualified official extended duty. In addition, members of the military who have been deployed overseas for 90 days or more in 2008 or 2009 would have until April 30, 2011, to claim the home buyer tax credit.

8. The amendment also includes anti-fraud language that provides math authority to the IRS to do greater oversight during the processing of the return rather than waiting for an audit situation. The amendment requires the taxpayer claiming the credit to be 18 or older as well as requiring a HUD-1 settlement statement to be attached when claiming the credit.

Some cities have been hit much harder than others during the recession. Cities in California, Florida and Michigan, for instance, have been particularly hard hit, while others have seen their economy grow.

In a recent Brookings Institution Metro Monitor report, researchers gathered key economic statistics about the 100 largest US metro areas, including employment, home values and Gross Metropolitan Product (GMP). Among the surprising results — 38 metro areas recorded an increase in home values, even though the national average declined 6%.  They also note that these cities are in a good position to benefit from the nation's economic recovery.

Here are the top 15 and you can go to Brookings Institution report to get the entire list!

 Metro Monitor report

15)    Albuquerque, NM

14)    Washington, DC

13)    Des Moines, IA

12)    Wichita, KS

11)    El Paso, TX

10)    Omaha, NE

 9)     Tulsa, OK

 8)     Baton Rouge, LA

 7)     McAllen, TX

 6)     Little Rock, AR

 5)     Dallas, TX

 4)     Austin, TX

 3)     Houston, TX

 2)     Oklahoma City, OK

 1)     San Antonio, TX 

As reported by the National Association of REALTORS®, the number of Existing Home Sales dipped last month, ending the metric's 5-month winning streak. 

Newspaper headlines are overwhelmingly negative on housing. You'd almost believe this year's housing recovery had ended. 

That's hardly the case.

See, the other side of the Existing Home Sales story is that -- while the number of units sold did fall by 3 percent -- the months of existing supply fell by nearly a year.

To home buyers and home sellers, this is huge.  Home prices are based on supply and demand and with supplies plummeting, it means that home prices are poised to rise.

Indeed, dwindling inventory isn't "news" to today's buyers.  Multiple offer situations have been common since the start of the summer and, should supplies fall further, they may soon be the home-buying rule rather than the exception.

Since peaking in November 2008, existing home supplies are down 23%.

As you can see on the longer term chart below, we still have some homes to sell before we work back to historical norms, but progress is being made.  Somewhere in the 6 months supply range would be considered on the outer range of healthy.

A recent survey shows the median amount of household credit card debt is $6,600 and the average debt load is almost $9,900. Further, of the 88 million credit card carrying households, 61% carry a balance from month to month.

If you feel like you’re sinking under the weight of debt, looking into a debt or credit “help” firm may seem like a good idea. But some of these firms that promise to eliminate debt or repair credit may not be operating in compliance with the law, and doing business with them could have long term negative effects on your credit report and ability to get credit.

Here are six key “red flags” to look for when you’re researching a debt elimination or credit repair service.2

Red Flag #1: The company wants you to pay for credit repair services before any such services are actually provided.

Red Flag #2: You are not made aware of your rights and no information on what you can do to help yourself for free is provided.

Red Flag #3: The firm recommends you do not contact any of the three major credit reporting companies directly.

Red Flag #4: You’re told that the debt firm can get rid of most or all of the accurate negative information in your credit report.

Red Flag #5: The company suggests that you invent a “new” credit identity.

Red Flag #6: You are advised to dispute all the information contained in your credit report regardless of its accuracy or timeliness.

For more information about debt payoff scams, contact the Federal Trade Commission. To learn about Primerica’s debt solutions, visit www.Primerica.com.

1 Los Angeles Times, www.latimes.com, viewed June 8, 2009
2 www.FTC.gov, viewed February 25, 2009

This blog was supplied compliments of Lawrence Davis of Primerica and guest blogger with NHLA.

House prices in the U.S. continued to depreciate in the second quarter 2009 but at a much more moderate rate compared to the fourth quarter 2008, the peak of the collapse in home prices, according to a quarterly housing valuation analysis by IHS Global Insight.

Prices fell at a 2.7% annualized rate in the second quarter 2009, compared to 2.1% in the first quarter and a 12.5% rate of decline in the fourth quarter 2008, according to the new House Prices in America, the quarterly U.S. housing valuation analysis from IHS Global Insight, one of the world’s leading companies for economic and financial analysis and forecasting.

Nationally, house prices have fallen 11.0%, on average, below their peak in the spring of 2007; when weighted by market value, the nation is now 11.1% undervalued, and 12.6% undervalued when weighted by housing units.

Prices declined in slightly more than one-third– 113 metros– of the 330 metropolitan areas in the study, down from 191 areas in decline in the first quarter, and down sharply from 317 areas registering declines in the fourth quarter of 2008.

Metro areas in California, Florida, and Nevada, states that experienced the highest levels of overvaluation as the housing bubble expanded, and Michigan, which has been hit hard by the recession and cutbacks in the auto industry, have experienced the greatest declines.

More than one-third of the nation’s metro areas– 127– have seen prices decline by more than 10%, and nine have seen prices drop by more than 50%, with Merced, Calif., experiencing price declines of 65% off their peak. The largest second quarter home price decline was 6.1%, in St. George, Utah.

Only 16 metro areas, most in the middle of the country and six in Texas, have escaped net home declines during this cycle. Extreme home price overvaluation is essentially nonexistent. Only Atlantic City, N.J., remained extremely overvalued, in stark contrast to 2005 when 52 metro areas, fully one-sixth of the nation’s metropolitan areas, were extremely overvalued.

For more information, visit www.ihsglobalinsight.com.

David Dickey

National Home Loan Advocates