Story Published:
Mar 26, 2009 at 7:18 PM MDT
Story Updated:
Mar 26, 2009 at 10:23 PM MDT
BILLINGS - If your financial situation is secure, this might be a good time to make the leap from renter to homeowner.
Newlyweds Joe and Julie Simanton have made one of the biggest decisions of their lives, to become homeowners.
"We've been renting and it just feels like we've been throwing our money down the drain every month, so this is just a great opportunity," said Julie The Simantons are taking advantage of congress's revamped $8,000 dollar first-time home buyer tax credit. "We just can't pass it up."
Their realtor, Greg McCall with McCall Development, said agents across the nation want buyers to know this credit exists. "It has morphed over the course of this last year from what was a $7,500, zero interest loan to truly $8,000 to first-time home buyers, free money, go buy a house, stimulate the american economy," said McCall.
The $8,000 does not have to be repaid so long as you stay in the home for the next three years. You have to file a tax return to claim it. It is not an adjustment to your income or a deduction, it is a refundable tax credit.
"They have to act quickly though because that credit will be gone after December 1," said McCall.
There are income limitations: the credit begins to phase out for taxpayers with adjusted gross incomes of more than $75,000 for single filers and $150,000 for joint filers, and it is completely phased out for single filers at $95,000, and $170,000 for joint.
Scott Rickard, MSU-Billings economist, said with the low interest rates and these home-buyer incentives, it is a good time to buy in Billings, so long as you are financially ready. "If you do have the credit and you are able to afford the payments and afford them well within your means, yeah, I do think it's a good time but just don't expect in the near future real estate is going to produce the kind of returns that it did in the past," said Rickard.
The Simanton's will be trading in a monthly rent payment of a thousand dollars for a monthly mortgage of about $1,300 dollars. They said it makes them a bit nervous, but they are ready for the move.
"It's a huge deal, we're really excited to own our own home and get out there and mow the law every Sunday and plant flowers," said Julie. A first-time home buyer is defined as anyone who has not owned a principal residence in the last three years.
So, you could have owned a home a few years ago, been renting for the past three years, and possibly qualify for the $8,000 dollar tax credit.
Now, the Simantons are building their home, but there are plenty of existing homes on the market in Billings and the surrounding area.
Existing homes sales in Billings rose 65% last month with 96 homes sold at an average price of $197,000 dollars. The Multiple Listing Service shows more than 12-hundred homes on the market in the area.
Twyla Best, broker and president Billings Association of Realtors, said $200,000 dollars and below is the hottest price range in Billings. "With the amount of inventory that we have right now it is a great time to be a buyer," said Best.
She said the MLS shows 520 homes on the market right now that are $200,000 dollars and below. Nationally, new home sales rose 4.7% in February.
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