Although the real estate market has reportedly been awful, there is a little glimmer of light. Because of incredibly low real estate prices, terrific interest rates, and an extremely generous government, first time home buyers are the only ones that seem to be able to buy a new home. The move-up market is at a virtual dead halt.
If you are buying your first home before December 1, 2009, and using it as your primary residence you can pocket some money. The American Recovery and Reinvestment Act of 2009 allows you to claim a tax credit of 10 percent of the purchase price up to $ 8,000 on your taxes, only $ 4,000 for those that are married filing separately. The home must remain your primary residence for three years. Contact your tax preparer for more details and to see if you will qualify.
City of L.A. Programs for First Time Buyers
In addition to the incentives that the Federal government is extending, the city of Los Angeles is looking to help as well. The Los Angeles Housing Department has a handful of home ownership programs that are worth checking into.
· The City of Los Angeles Housing Department (LAHD) offers purchase assistance financing to eligible first-time, low income homebuyers seeking to purchase a home in the City of Los Angeles. This is a deferred loan for closing costs and down payment and rehabilitation costs if necessary.
· Also available is the American Dream Down Payment Initiative Program. All low income applicants will be considered for this program as well.
· The City of Los Angeles also offers Moderate Income Purchase Assistance Programs. This program offers financing assistance for closing costs and down payments and rehabilitation costs if necessary.
While you may have to be put on a waiting list for one of these programs, it is worth checking into. In fact, your lender will probably be able to give you information regarding these programs.
In case you think you may not qualify for a first time home buyer credit, either on the Federal or the local level, in most cases a first time home buyer is defined as someone that has not had ownership interest in their primary residence in three years. Many that think they are not first time buyers, may be surprised.
You Can Enter the L.A. Real Estate Market Running
The government is making it easier for first time home buyers to enter the real estate market running. The market is not being flooded by first time buyers by any means. It just so happens that the move-up market is so stagnant that it is almost non-existent. When that’s what you’re comparing it to, the first time buyer market seems big.
If you are someone considering buying your first home in the Los Angeles area, be sure that you get all the details before you sign your papers. Know what programs are available and what the stipulations are. For example, if you intend to move within a couple years the federal credit will have to be repaid. Know what interest rates are available and be sure that the lender that you choose to work with is current on all programs offered by the city of L.A.
Samantha Alessandro is a licensed real estate agent and Los Angeles real estate expert. She currently works for CaliFindIt.com, California’s premier source of information. If you are searching for the best agents and properties currently for sale in Los Angeles, visit http://www.realestate.califindit.com where you can map out available properties in neighborhoods and take a virtual tour of your selected properties.