The First Time Home Buyer Tax Credit Is Winding Down

By rerockstar • March 26th, 2010

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April 30th is approaching fast.

** UPDATE July 2, 2010 – Congress separated the first time home buyer tax credit and National Flood Insurance Program extensions from their original bill and passed them as H.R. 5623 and H.R. 5569 respectively. President Obama signed them into law on July 2, 2010. **

** Please note: the first time home buyer tax credit extension only applies to those who were already under contract as of April 30, 2010. **

The clock is ticking (once again) on the First Time Home Buyer Tax Credit. Whether you’re a first time home buyer or a move-up buyer, the tax credit is set to expire on April 30th (must have a contract by close of the day) and although this thing has been extended over and over, there have been no plans to extend it through 2010 or into 2011. Unfortunately, the constant extension and expansion of the tax credit has given many buyers a sense of false hope that “maybe they’ll extend it one more time and I can buy later this year,” but I don’t think we’re going to see it this time around.

While I don’t think anyone should rush out and buy a house just because of the first time home buyer tax credit, I do think that if you’re a home buyer looking to take advantage of the tax credit and you’re ready to buy a home, you need to hunker down and get to work. The San Antonio housing market has been heating up as the weather has turned warm. As more home buyers enter the market and more sellers begin to realize this, they are taking longer in negotiations, raising prices (I saw several yesterday that were listed for much less in January), and not taking a look at some of the below asking price offers that were common place in the latter part of 2009. Multiple offers on homes are not unheard of this Spring and paying more than asking price isn’t as uncommon as one might think.

If you’re serious about buying a home before the tax credit expires, I would suggest you start looking for homes in San Antonio today and try to have an offer on a home made by around April 15th. Yes, you can make an offers up until the April 30th deadline for the First Time Home Buyer Tax Credit (remember these purchases must close by June 30th in order to receive the tax credit), but giving yourself some time for negotiation or even rejection (and subsequently needing time to find another home) will make this much smoother for you.

photo courtesy of stevendepolo