Deadline nears for home buyer tax credit

By Andy Jenks - bio | email
Posted by Terry Alexander - email

RICHMOND, VA (WWBT) - When the housing market was tanking in 2008, the government thought it would be a good idea to give home buyers some money back. Now it appears the incentive is coming to an end. There are just 30 days to go before what most experts assume will be the final deadline for home-buyers looking to get a gift worth up to $8,000.

Buying a house for the first time, can take a long time. You have to get qualified, get an agent, go to listings, make an offer, and negotiate. That's why brokers say the approaching tax credit deadline - is a lot closer than it seems.

"You don't want to waste time waiting till the last week trying to cram as many as you can," said Taylor Steele of Virginia Realty and Relocation.

Qualified first-time home buyers can get up to $8,000 back, only if they go to contract by April 30, and then close the deal by June 30. Existing homeowners looking to trade-up, can get up to $6,500, and the same deadlines apply. The credits are at least partly responsible for a rebound in the housing market, meaning this deadline is likely the last.

"Now that the economic indicators are better I don't think they will extend it," Steele said.

Brokers say it's a buyer's market. According to the real estate tracking web site, the median sales price of a home in Richmond is down nearly 3% (to $168,950) when compared to a year ago. The median price is down nearly 5% (to $280,000) in Glen Allen. But in Midlothian, the median price is up 2.7% (to $253,000).

"People are back out there looking now, and they want to take advantage of the home buyer credit before it goes away," Steele said.

The tax credit phases out for wealthier buyers, and in some cases it depends on whether you've owned a home in the past three years. For sure, you'll get nothing - if you miss the deadline of April 30.

"There's a lot of houses to look at. So you've got to get out there and find the one you want, and I would get right on it," Steele said.

For detailed information on the rules - and to see if you qualify, click here.

Copyright 2010 WWBT NBC12. All rights reserved.