Although it is not signed quite yet, the odds are very good that this will be the approved Economic Stimulus Plan.
To summarize, here is how it will affect real estate. Let me just say that I am quite pleased. Nothing is perfect and we'll see if/when/how the banks deal with it but overall, there are some nice adjustments in the Bill.
- Conforming loan limits for high-cost areas like SAN FRANCISCO will be raised to $727,000 or $729,500 depending on who you ask. We'll see which is correct shortly. This is MAJOR b/c it means that more home buyers will be able to get the best interest rates on their San Francisco home purchases. This is good news for sellers too and should help the condo market recovery here in SF.
- The home buyer tax credit is now $8000 and is no longer a loan. It is a true credit. Also, awesome.
- Interest rates have come down 125-150 basis points. Check with your mortgage banker or broker for specific rates for you... The rate you will get is based on much more than the published rates so find out for sure. Don't have a lender? Look at our list of recommended mortgage consultants and give 1 or 2 of them a ring.
- The bill has over $50 billion in it for foreclosure mitigation.
- Fannie Mae has just agreed to lift the cap of 4 investment properties eligible for loans and raise it to 10
It is also VERY important to note what we got to keep. Every time Congress enacts a bill, all existing items are on the table. Thank Ford, we kept:
- mortgage interest deductability on your personal income taxes
- real estate tax deductability on your personal income taxes
- the $250,000/$500,000 capital gains exclusion
More info here: http://www.realtor.org/press_room/news_releases/2009/02/housing_stimulus_and_stabilization_will_help_economy
Be very careful if you have been trying to time the market. Except for maybe new construction condos and some other condos, lofts, and TICs, you'd be crazy not to take advantage of today's market and buy yourself a home or investment. That is, IF your job is stable and it's the right time for you...
Have a great weekend!
-Danielle
