Interest in purchasing a home as an investment has more than tripled in the last year, according to a survey released today by REALTOR.com.
More than 17 percent of potential home buyers say they plan to purchase a home in the near future as an investment, compared to just 5.6 percent in March 2009, the survey found.
Owning a residence in remains a goal for many more potential buyers:
• 21 percent of consumers report they plan to purchase a home in the next 12 months to five years.
• 8 percent plan to purchase in the next two years.
• 49 percent of all home owners would buy another home today if they could sell the one they currently own for what they paid for it.
Of those planning to purchase a home in the near future, 50 percent are first-time buyers.
While access to financing is important, many buyers plan to use cash to make real estate purchase:
• 12 percent of Americans planning to purchase investment property in the near future say they will pay for the property using 100 percent cash.
• 13 percent will use cash for more than 50 percent of the purchase price and finance the rest.
• 50 percent say they will buy the property with less than 50 percent cash down and finance the remainder.
California's Tax Credit Monies May Go Fast
The $100 million allocated for California's first-time homebuyer tax credits may be depleted in about 10 to 20 days or sooner, according to California Association of Realtor's Economics team.
California's Franchise Tax Board (FTB) plans to begin accepting applications on May 1, 2010 for tax credits up to $10,000 for first-time homebuyers and for homes that have never been previously occupied. However, the total tax credit allocation for all taxpayers is $100 million for first-time homebuyers and $100 million for new homes, both on a first-come, first-served basis.
C.A.R.'s forecast of 10 to 20 days to deplete the $100 million allocation for first-time home buyers is based on estimated May sales figures and other parameters. It does not take into account the possibility that buyers scheduled to close escrow in April may delay closing until May to take advantage of the tax credit. If a shift in closings from April to May occurs, the first-time homebuyer tax credits may be depleted even more quickly than indicated above.
Applications for the California tax credit must be faxed to the FTB after escrow closes. The FTB will update its website when the 2010 application form and other information become available.
California's Franchise Tax Board (FTB) plans to begin accepting applications on May 1, 2010 for tax credits up to $10,000 for first-time homebuyers and for homes that have never been previously occupied. However, the total tax credit allocation for all taxpayers is $100 million for first-time homebuyers and $100 million for new homes, both on a first-come, first-served basis.
C.A.R.'s forecast of 10 to 20 days to deplete the $100 million allocation for first-time home buyers is based on estimated May sales figures and other parameters. It does not take into account the possibility that buyers scheduled to close escrow in April may delay closing until May to take advantage of the tax credit. If a shift in closings from April to May occurs, the first-time homebuyer tax credits may be depleted even more quickly than indicated above.
Applications for the California tax credit must be faxed to the FTB after escrow closes. The FTB will update its website when the 2010 application form and other information become available.
California won't tax forgiven home debt
In a statement Monday, Govenor Schwarzenegger said, "It is important that we continue to provide all possible assistance to homeowners who were negatively impacted by the mortgage crisis…and protect them from thousands of dollars in unfair taxes."
Those affected can now rest a little easier, knowing they won't be hit with a large state tax bill after already being forced to sell their home at a huge loss.
Mortgage debt is typically considered forgiven by lenders – and eligible for taxation as extra income – during a foreclosure or a short sale. In short sales, lenders accept a price below what's owed to avoid higher costs of foreclosing. The difference is the forgiven debt.
The state Franchise Tax Board estimates about 100,000 Californians will be spared from $34 million in state taxes through 2012 as a result of the new law.
The tax relief plan applies only to people who lost homes in which they lived. Investors are not affected and still owe, says the FTB.
State officials say qualified taxpayers don't have to do anything to get the tax break. Those who qualify for federal relief will automatically get the state relief.
Those affected can now rest a little easier, knowing they won't be hit with a large state tax bill after already being forced to sell their home at a huge loss.
Mortgage debt is typically considered forgiven by lenders – and eligible for taxation as extra income – during a foreclosure or a short sale. In short sales, lenders accept a price below what's owed to avoid higher costs of foreclosing. The difference is the forgiven debt.
The state Franchise Tax Board estimates about 100,000 Californians will be spared from $34 million in state taxes through 2012 as a result of the new law.
The tax relief plan applies only to people who lost homes in which they lived. Investors are not affected and still owe, says the FTB.
State officials say qualified taxpayers don't have to do anything to get the tax break. Those who qualify for federal relief will automatically get the state relief.
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