First-time homebuyers must close by Nov. 30 – contract not enough
WASHINGTON – April 24, 2009 –
If first-time homebuyers wait until November to sign a sales contract, it’s probably too late to get the $8,000 tax credit. To qualify, buyers must close before Dec. 1 – a signed contract is not enough. New construction should be started by mid-summer to qualify.
According to the National Association of Realtors, a “home is considered as ‘purchased’ when all events have occurred that transfer the title from the seller to the new purchaser. Thus, closings must occur before December 1, 2009 for purchases to be eligible for the credit.”
Noting that deadline, the National Association of Builders kicked off a campaign notifying buyers that if they want the tax credit, they should plan to sign a construction contact soon.Mike Dishberger of Sandcastle Homes Inc. in Houston, Texas, says that building a home from scratch can take anywhere from four to six months depending on the floor plan and location.
Assuming it takes the full six months, first-time homebuyers should sign a new-home construction contract no later than May 31, 2009.While it’s possible to rush an existing-home sale and go from contract to closing in only a few weeks, that schedule could cause a problem for last-minute buyers who wait until November.
If an onslaught of buyers hope to beat the clock, title agencies and others involved in the closing process could get backlogged during November, and the IRS does not consider “planned closing dates” for the tax credit – only actual closing dates. To qualify for the tax credit, home buyers must have not owned a home for three years prior to the purchase and have a modified adjusted gross income (MAGI) less than $95,000 for single tax payers and $170,000.
More information on the first-time home buyer tax credit, visit floridarealtors.org at: http://www.floridarealtors.org/NewsAndEvents/n1-021709.cfm.
Maria T. Villalobos ASP,CRT
Realtor - Associate
Brickell Realty Group, LLC
Cell. 786-285-5855
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