CNN Money reports 25% home price decline ahead for our area!!

Take a look at this eye-opening post on our Winston Trails blog...If you're a home owner, you NEED to read it.
 Just click right here

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IRS says "sorry, you can't file for your tax credit"!

 NEW YORK (CNNMoney.com) -- Did you purchase a home after Nov. 6? Don't expect your $8,000 homebuyer tax credit any time soon. Since Congress passed the initial tax credit last February... more than 1.4 million buyers have taken advantage of it...But that all changed on Nov. 6...it appears that the IRS has NOT ALLOWED ANYONE TO FILE since November 6th...

Congress extended the credit to include contracts signed by April 30 and closed by June 30. It also made a refund of up to $6,500 available to existing homeowners looking to buy something new. And that marked the start of a new IRS paperwork wrangle. Those homeowners who closed their sale before Nov. 6 use Form 5405 to claim the credit right away. But those closing after that date are in limbo because no form yet exists for them to file! The IRS had been expected to come out with a revised form by early January, but it has yet to release anything.

Also, with the new fraud-prevention regulation attached to the extension/expansion credit, there is no E-filing available for those claiming the extension...adding to the already extended timeframe for the tax credit refund.

If you are planning to buy within the timeframe guidelines of the tax credit and are hoping to receive the money quickly...don't count on it!
As always, check with your tax advisor...

FHA, 1st time buyers, short sales and perceptions...

• Nearly 40% of existing homes purchased in November used an FHA-insured mortgage, according to a National Association of Realtors survey.

• As a result, the FHA is having to defend the program, saying that it is well enough capitalized to avoid any major losses in case of surging defaults. Earlier this month, Department of Housing and Urban Development secretary Shaun Donovan was before Congress defending the FHA, and ensuring the House Financial Services Committee that the single-family insurance program is “not the next subprime.”

• The increase in demand caused the capital reserve ratio at the FHA to drop below the Congressionally mandated 2% minimum, leaving HUD and the FHA scrambling to ensure the FHA program’s soundness.

• A number of proposals are being considered, including the raising of insurance premiums, raising the minimum FICO (credit score) requirements, raising the minimum required down payments and reducing the allowable seller contribution...all of which will make it more difficult for buyers to qualify for and obtain financing (and hence, not good for sellers).

• Other results from the Realtors survey showed first time homebuyers accounted for 51% of all transactions and are actively competing with investors for distressed properties...

• And, distressed properties aren’t just affecting transaction price, however. The presence of distressed properties is influencing buyers’ perceptions of other homes for sale and many buyers have pricing expectations that treat every property as if it were a distressed sale.

• Additionally, HUD issued a ruling that borrowers who were in default on their mortgage at the time of a short sale are not eligible for an FHA-insured mortgage for three years...

1st time homebuyer tax credit extension almost certain to pass this week...

After two weeks of delay, the Senate, last night, cleared the way to pass a seven month extension and expansion of the tax credit for homebuyers... making it virtually certain that the legislation will reach President Obama for his signature this week.

The homebuyer tax credit, due to expire in 28 days, would be extended through April 30 of next year. First-time buyers who are in process of making a purchased would not need to worry about qualifying for the $8,000 credit if they close after the November 30 deadline.

For the first time, the legislation cleared last night makes move-up buyers as well as first-time buyers would be eligible for a credit. The $8,000 maximum first-timer credit will continue and will now available to couples with income up to $225,000, a nearly $55,000 increase above the level in existing law.

A new $6,500 maximum credit would also be available to move-up homeowners who have lived in their current residence for five of the prior eight years... it is virtually certain that the President will sign the legislative package, which contains an expansion of unemployment benefits as well as tax changes.