$10,000 credit for NEW home buyers in California

Kim and I wanted to make sure that you heard about $10,000 tax incentive that has just been approved in the newly signed California budget.

While this does nothing to shrink the inventory of existing resales homes, it will put some people back to work in the badly hit construction industry.

The bottom line…

• $10,000 credit is only for NEW construction
• Buyers will get a tax credit of 5 percent of the purchase price, up to $10,000, beginning March 1, 2009. The state measure runs through March, 2010, or when funding authority runs out, whichever comes first.
• The tax credit will apply to state tax returns at a rate of $3,300 per year for three consecutive years, as long as the purchasers reside in the home for at least two years.
• Allocated by the FTB on a first come-first serve basis (details still need to be worked out)
• No income limits.
• No first-time buyer requirement.
• No repayment requirement, unless the buyer sells or rents the home before two years are up.

Suggested Reading…

http://www.sacbee.com/736/story/1639155.html

http://www.housingcrisis.com/financial-crisis/california-steps-big-time-home-buyer-tax-credit-plan/

http://www.reuters.com/article/idUSTRE51J64P20090220