….I love our monthly market report for our region. They do such a valiant effort (As do I, mostly) of putting a good shine on.

This month they touted that the numbers were up from February to March! Big jump!…Until you look a bit closer and see that the numbers are down, year over year by 40%. Ouch.

While our closed sales YTD are tracking last years, you can see another potential for slowdown in the pending numbers, and the inventory numbers. It evolves by the day, and one good sunny day could have a big impact.

This should drop the inventory (It has) and stiffen the market (it has…kind of) but this month we are seeing quite the flood of properties on the market, so my inventory crash was quite short lived…..It turns out, you can’t score if you don’t play, so look for lots of people to have a ticket in that game, but listing homes that are essentially unsellable due to indebtedness. Our trends are very choppy, and clearly divided into the two markets, Those that have to, and those than can. We are running about the same as the national markets, with 40% of our transactions being defined as “short.”

Last month, I incorrectly identified that the market has two “ends” higher, and lower, and that the higher was made up of those that can…I want to clarify that there are examples of both types all over the market price ranges, and that this is leading to a really choppy presentation of properties in the market…..and the dreaded resets.

…And speaking of resets, just as the demand firms up, the appraisals from a bunch of foreclosures are hitting valuations. We are having a HECK of a time making negotiated value. Seems a lot more people want to live here than the appraisers think….

So, we continue bouncing along the bottom. We are having a big push of sales get in the pipe right now, so that seems positive, but the big news will be how that carries into the Summer, and especially, the Fall.

There are a couple of great updates on the blog over at Copperwest, too. In the index of the blog are a couple of links to pages that are “mini-searches” of sub markets in the gorge. They have the 10 newest properties, AND the ten largest price reductions. Kinda cool.

Next month, apparently, we are going to launch a mobile app too…..ooh pretty.

See you then. And have a great Spring, such as it were……

Thankfully, I’m not late to post this month………..Things have certainly been slower, so I’ve got time to catch up, that’s for sure. Weather has been amazing as well……and that’s why September is the best month of the year in Hood River!

All brokers are working this month and the buyer’s activity has been high. Year to date numbers show us selling the same units as some of our competitors, quite an accomplishment when you consider we are less than one quarter their size. Thank goodness for process.

Prices are stable to weak, with closings that occasionally firm up a price range, and others, that are destroying price ranges. Houses in the 500+ range are shrinking quickly, and we are now seeing multiple markdowns of properties that opened into the “dead zone” of 600+…..Inventory months will be dropping in the next few months, which is a traditional fall trend, but expect it to be a bit more pronounced this year.

Closings from Augusts rush are coming in, and if you are planning on doing something in Real Estate, especially refinance, PLEASE do yourself a favor and call us first, so you don’t spend $500.00 to find out your market got reset last week……I can’t tell you how often this is happening.

The constant drumbeat of price reduction has faded slightly, and in the last few weeks, the buyer’s have been overplaying their hands, much to their chagrin. Sellers are simply balking at another 15% off their already 25% marked down home, and where they don’t have to sell, they wont. Unfortunately, if they DO have to sell, it’s becoming a rare property that can get down into the correct range without going equity negative. Generally, you can look at a purchase date and get an idea. If you bought in 2005 more or less, you are a more likely candidate of getting through. 06-09 is tough, unless you came in equity heavy.

So now, the focus is on those few remaining properties that are equity heavy, but willing to deal……now, they do, however often come with those “quality defects” I’ve so often mentioned….but hey, at least there are buyers. I’d even hazard that the “confidence gap” has narrowed recently….

Foreclosure notices are now taking up a full two pages in the weekly Hood River News. Sobering. I remember when that was last the case, and it was all the way back in 1992….

I see some bright spots (like us being up 100% for the year) but it isn’t without its bare knuckle work. 4.375% 30 year fixed is the going rate, and that will certainly get someone interested, but with negotiation, appraisal, Automated Market Valuations, desk reviews, and jittery sellers, who are negotiating while they are coming to grips with “is that all I can get?” well…..

It is no country for old men, to use a movie title….. (Which was a terribly depressing movie…but very good. Who thinks of that stuff?)

October is looking weak, but traditionally we save it in the last selling week. (Which is last calendar week of September) The big test is November. We already have December in the books, so it’s a 60 day game, clock is ticking, and we are slightly behind…..

So, got to run, see you next month, Thanks for reading!

June Market Action is out. It’s posted here.  As expected, pending sales were waaay down, though still up for the year, overall. Days on market spiked in late April, then crashed through that date (offers rush in late April) expect that to rise steeply for July’s report.

Total inventory is slightly lower ytd than last year, given the quality of the inventory, (pretty good) I can guess at a couple of things. We might have chewed though the “easy foreclosure” properties and be delving into the “hanging on for dear life” inventory……I’ve also noticed the average ask for the most recent new listings have been over $500,000…..also, potentially indicative of something more sinister.

Good news this month comes from others, smarter than I looking deeper into the SD issue. It turns out, with limited early data arriving, that the average home value drop would have to be off 62% or more, before home owners decide that an SD is the way to go…..That’s a long, long way…..especially around here.  Score one for moral fortitude.

Interestingly, when you calculate the total home value in the US against the total mortgage debt outstanding, (and this calculation has been done by a couple of sources, so I’m mostly reposting) what apparently shows up is this tidbit….that given the value of the housing inventory in the United States, the indebtedness is too high, indicating an erosion of equity, which is an indicator of increasing foreclosure pressure. (We didn’t need a macro-economics calculation of tell us that, but anyway……)

That’s certainly a big picture view, to be sure, and includes the traditional wipeout zones,(CA, AZ, NEV and FLA.)  We are not one of those areas, but comes troubling data from a couple of blog sources that Oregon is the #3 foreclosure state in the country…..I’m not sure of #3 of what (per capita? Rate per 100?) I went and looked at Realty Trac’s heat maps for Oregon, and we show 10 foreclosures for June, (1 in every 891 units, which is a screwy calc, for a whole number of reasons…)……So, moderate. Not sure where this is coming from but……….Oh wait, I figured it out…. It’s from This Article…

Ok, now that I’ve read it….it’s #3 in the rate of filing….ummm..nevermind. That was totally overhyped. Late to the party, still on the steep part of the curve…..

Which brings me to my next point. The media, blogosphere and others are tweaking the scare-o-meter too much. Don’t get me wrong, It’s bad, it’s tough, and it’s going to be a tough and long, and hard road, but claiming we are #3 in the nation for foreclosures is just patently inaccurate, and it’s meant to scare people. Unfortunately, it’s working. (see: “birds on a wire” below)

Ok, back to Hood River.

Regardless, however, the price reductions have begun, as the sellers are seeing the Summer wane, and now pivot to a strategy for Fall. Rent or Reduce? That is the question. It’s about 50/50 now, but I know that buyers are out there, sitting, watching, and waiting.  I refer to it as a group of “birds on a wire” (Forgive me, anyone whom I’ve told this to in the last week) They will all sit there, until one of them makes a move, then they’ll all move at once…..The interesting thing is this, there are more birds than there are properties they are interested in, so when one moves, expect that all of them will move at once……just in a specific section of the market (I’m not telling what part, but you could easily intuit it.) but I can assure you they are there, and they are ready for the signal. Problem is, I’m not the guy in charge of the signal…..

So, expect soft pricing, and low rates for the rest of the Summer, with a random vaporization of a segment of the market around…..first week of august. Earlier if someone clues in and jumps on the best deal first (which happens to be one of my listings! Yipee!)

Lets all go get outside and on the water. Don’t have to worry so much out there……See you next month.

….Been a decent January for us, but there’s still trouble on the horizon. New disclosure laws went into effect, specifically Good Faith Estimates and a SLEW of new reforms. I am not sure at all that any of it helps, but after a long talk and some research, I can say this……I can see where they are wanting to head, but they didn’t get there with the current GFE and closing documents……

I think they’ll get there, but the revisions, can’t come soon enough.

Near as I can figure, a mortgage broker will need a worksheet on the front end to explain all the terms to a borrower. Then they will have the required GFE (which they can’t change much, and in some spots its just indecipherable, but I KNOW the people responsible for this already know this) and then they will have to have a settlement sheet to explain what the GFE really says and what the borrowers need to do in order to close.

Oh, and you can’t get a GFE anymore without an actual property, and an actual purchase price….so, you most likely have to get a “quote worksheet” when you get preapproved, do the deal,  get through inspections, and THEN fire up the mortgage brokers to quote rates and closing costs for you…..

Bottom line, If your Realtor can’t explain this stuff to you, get another Realtor. As of right now, I think I could explain it to you….but I honestly couldn’t swear it. Don’t fire me!

This and a few things will push out closings for a bit, and then they’ll snap back to the usual 30 days after awhile. Why, I just closed one today that too exactly 29 days….clean and simple. (actually they had the home inspection completed before the offer, so…..that was cheating a bit.

Banks are still defending their liquidity, and I’m finally seeing big media pick up on the fact that the banks are still playing a bit of a shell game.  They still have to lend, however, so they are being picky, picky, picky……

Our local bank bit the farm this week too. Not that it was a huge surprise, but…..it was a big surprise.

I fully suspect the home owner’s tax credit program to be extended, things are just not healthy enough yet. I suspect that the secondary market buying programs will continue as well, probably until the end of 2010.  That’s just me guessing, but I’m seeing a recovery, but not an improvement. (Recovery= market reassembles itself with moderately sane people in it trading at arms length. Improvement=anything resembling firming, like price uptick, volume uptick for multiple months, of heaven forbid, multiple buyers again. I can dream can’t I?)

There seems to have been another round of capitulation in the market too, in January. Price reductions have happened, but when there’s no market (or the sector is hibernating) there’s just no market. And it opens the door to the other scary question (what’s the value of a property when there’s no market?) I suspect this will continue until March, when all those discounted places will get snapped up, and we’ll have another round of firming, there will be an even bigger flush of new properties, and then….well, you get the picture.

Hey, at least stuff is selling.

About the kookiest thing to come out of the prior RESPA reforms (actually the HVCC) is the completely random lowest cost provider Appraisers. In a market where the HVCC is supposed to reduce the chance of coercion, I’m commonly asked by appraisers who are not from the local area what good comps are for their target homes. They don’t know or understand the market, and subsequently come up with some of the most random valuations I’ve ever seen. Apparently, being a local appraiser doesn’t count for anything anymore. It’s pretty hilarious, and a glaring flaw in the theory versus reality. I’m confident it will change over time, as a lot of the appraisers from out of the area have determined that the travel time is too great, and have given up.

And finally, check out the FB page for Copperwest. There are three good topics on there, including the morality of walking away, a recent report indicating that housing sizes are shrinking, but that the kitchen is still king, and…..the 2009 Home remodelers report, which tells you what you can expect to get out or any remodel by type and region, great stuff at Copperwest.com, and It’s going to be even Bettter Next Month!

First, we have a nice Facebook page now, find us on the web, or visit Copperwest.com and the feed from FB on the Front page. We like Facebook because we can quickly post new listings, and comments on the web, and it gets broadcast easily. It also pushes to twitter, where you can follow us at copperwestHR.

Things are quieting down; the last of the fall push is getting through. There are still buyers in the marketplace, buy they seem to be doing reconnaissance for early January. Lenders continue to be harsh, and I’m starting to determine that there is some sort of secondary market negotiation going on. It appears that one day a lender will let something through without a comment, and on another, they will call it out. I can tell the items that are getting called out are not related to any sort of government guaranteed program, so I’m left thinking that it’s some sort of other underwriting standard, especially with the appearance of randomness. Take away? MAKE SURE you have a strong lending package before you start looking for a home, and MAKE SURE you are looking at homes that you and your broker feel is a quality home, within the zoning of the area, and that it has at least a reasonable valid reason for being there (often called “properly entitled”)

The tax credit extension was a welcome sight, but it does appear that most of the people who could have taken advantage of the program, actually did. The new program (for current homeowners) that allows up to $6,500 in tax credit for a qualifying transaction will hopefully drive some spring sales…..

Everyone is looking to the Holidays, and getting ready for 2010, however, listing volume jumped a bit as new properties refilled the inventories. Pricing, however, remains soft.

One interesting development I read about this week is the I-banks out of New York have been buying portfolios of loans, and then segmenting them into risk groupings, and selling them off. Sounds a bit like the mortgage pools that caused the problem in the first place, but this seems to be moving the inventory out of the marketplace, which ultimately, is a good thing…..

For this month, I think we’ll take our outlook out of “prices are firming, but not rising” back down a small notch to “prices are slightly declining” although it’s a close call. Mostly seasonal…………

See you next month!

The Market continues to improve, however slightly. Prices have moderated by a bunch! Given the activity in the market, (being so price point oriented) has caused a dip in the average and median home price. I did notice, however, that the look and feel of that correction sort of maps to 2008. Inventory in months was at 14 (high, yes I know) then it went to over 30, then it came back to about 14. Same thing with average price, which is down 13% year over year. Looks like a cleanout to me…
Closings dropped in September, while pendings went up. You could probably call this a marker on the HERA and HVCC issues, as most deals are now between 30-45 days………
So, the long and short of it is that this is looking a lot like 2008, but with an upward bias, not a downward one……..
Inside the market, Average sale price got mauled by the lower price points in both Hood River Westside and City, down 6% and 18% year over year. Additionally a big drop off of pending sales, YTD in the City (off 32%) to the benefit of the Westside (Up 30%)  Again, some of that is sample size, but Downtown has flown higher in the past, and this would probably mark a return to earth on the values.

So that’s that in October. Time to settle in for a loooong haul until next spring. There’s some commercial activity as people look for projects, assuming they have financing, etc.

The Columbia Gorge Hotel has apparently been sold, there’s talk of a couple of new projects, but it’s still lean out there for the trades. Last winter there was lots of talk of a “die-off” of some businesses. We have been in here for so long, that I think there’s still a fair bit of carnage to occur. Hopefully it won’t be us, but there’s still a decent amount of uncertainty out there…….

On the computer front we now have a Face book page, our plan is to post new listings to that page, and updates. The Copper West Facebook page is located here.
Our twitter feed is @CopperwestHR

My Personal FB page is here.
And my Twitter feed is @Mauim

I keep the personal and business accounts quite separate, so you may choose, either neither or both!

And Finally, We are now posting the Monthly Market Reports from the RMLS on our website. They are located in the newsletters section under the about us tab at Copperwest.com

Thanks for Reading! If you like this post, please feel free to digg, tweet or otherwise! I appreciate it! Watch the video too!

Overall, Hood River Real Estate has been pretty good this month. Lots of deal action, but loooower prices.

Last year, in the fall, Sellers attempted to hold onto their prices, and managed to do a pretty good job of it. This year? Different story. Sellers have capitulated, and are selling at some steep discounts. That makes it tough for those left in the market trying to sell, but it makes the Buyers very happy.

Of course, that hangover will be lasting for a long, long time, as appraisals will become tougher with this seasonal dip. I’m certain appraisers can factor in distress sales, but a number of these sales are not distress sales, they are open, free market sales, and that’s going to hurt…..

HERA and HVCC continue to be slightly problematic, but more problematic are the new bankers dealing with mortgage. Now we are returning to the old “bankers” model; you have to prove you don’t need a loan to get a loan…….

Investments are pricing at cashflow again, I’m guessing closer to 8-12%. Thankfully. Lending, however, is all but impossible. These days, its all about owner financing.

Still with all of this, it’s been a good month, and October looks strong and so does November. That leaves only one month after that to get past 2009……….

Long term forecast for the Hood River market will be flat, at best, with pockets of calamity, and a few wipeouts. Mostly, though, people seem to be keeping it together, and most of all, working together to figure things out…..All in all, survivable.

Thanks for reading! see you next month!

Welcome to the View From Here! This is a text version of the video. Visit the View from here on You Tube or click below.
Overall this month has seen a good uptick in volume, but a decrease in prices. How’s that you say?

Cash. Cash cash cash……I’ve never seen so many all cash buyers in this market. Cash being King however, means something else…….discounts. And how.

Lots of discounted offers, and lots of deal making and negotiating. How these impact comparable sales can be devastating. Look for troubling signs out in Fox Hollow, and Country club, as appraisers attempt to swallow recent sales that are 20, and 30% below the asking prices. Other markets are marking to more traditional prices as sellers finally come back to earth in Hood River.

As prices grind lower, however, more and more buyers are showing up. The first wave and,  (in my opinion) the best deals have come and gone. If this does prove to be a bottom, July and August will be the floor. Remember about a year ago when I was talking about toxic events? I think I can say that barring another toxic event, the structural instability in residential is all priced in at this point. It’s only the bleeding that’s caused by long term unemployment that’s left, and that tends to come out slowly, and over time.

I hear in Florida, Nevada and California, there’s booming business in “foreclosure tours” but not here. Here, each deal is a one off, each motivation, unique. Neighbor to neighbor, house to house, block by block and marriage by marriage, it’s all playing out on a very small, and very personal scale. This is the downside of hyper-local.

As for mortgages…….Not too many troubles on the HERA adjustments, but I’m certain we’ll see some stuff here soon. Key factor to avoiding those issues, is don’t renegotiate the contract after appraisal has been ordered, make sure you intend on closing the deal with the mortgage broker you start the process with, and allow about 4-5 days ahead of closing to begin escrow……….

September is loading up, Hoping October will be strong as well. It’s been a long spring and Summer in Hood River Real Estate, see you out here soon!

There has been a decent pick up in the sale of Hood River Real Estate. Our local trends are mirroring that apparent feeling that we are bottoming out, the same as the sentiment found elsewhere. That does bring into question, was the Northwest in synch with the rest of the country, but less impacted? or are we lagging the rest of the country? (Some estimates are by two years! Boy, I’d hate it if that were true)

It’s becomming clear to me that we are in synch with the rest of the country, and are experienceing some bottoming, but we are by no means out of this, anytime soon. I’ve been commenting to clients that there are so few markers of where we are at, that I’ve fallen back to intuition. I’ve been trying to determine how I feel about this market, and then map that feeling back to a point in previous cycles I’ve experienced. From my experience, I think we are halfway. We’ve got another long year ahead of us before things start to improve. I’ve always been a fan of the best inventory coming at the front end of a recovery, and the best deals are at the back….so we’ll see.

I’ve been pondering how “value” is measured in the market at the moment as well. I was reminded of a certain client a few years back, who bought a property because of the square footage. The house was quite plain, and so people didn’t buy it because of it’s perceive plain-ness. Over the ensuing couple of years, he managed to solve all of the perceived problems of the house, and was able to extract some great value.

These days, it really appears that “quirkiness” properties that have great attributes, are not being valued correctly. A bunch of years ago I used to write about the “quality penalty” where if your home wasn’t *exactly* right, you were penalized ruthlessly on value. Now, I’m seeing that this cycle is a bit oversold. Really interesting properties with pretty small “quirks” (OK, and some not so small) are practically being ignored. I think there are some values there.

Price reductions have caught fire. You’d figure about August it would really start up, and I think a bunch of people have jumped the gun and are marking down. The markdowns are significant, and I think they will help. They have ripped apart a deal or two though.

Actually closing a deal however, continues to be challenging, but everyone is going to have to change, or go away. It used to be that my number one question from clients was “when will the loan documents be here?” now its “Did I get my Loan?”

The HVCC (Please see my Prior post) has caused some headaches and delays, but it’s not the worst thing in the world. Even the new restrictions on disclosures, the HERA disclosure and cooling off adjustments (Please see that post) are just shifting the structure of deals. I’m pretty happy about that. Managing a transaction for the largest asset you’ll ever (well, most of us, anyway) own, should be handled by people who handle negotiating, networking in real time, counseling skills. people who are expert at communicating across distance in real time. (That usually means having e-mail on your phone, at a minumum) There used to be an old tip in Real Estate, something about looking at a person’s shoes to indicate how much money they have (seriously) These days, there’s a cell phone version of that. If your realtor doesn’t have a phone that accepts e-mails and doesn’t text. Drop ‘em.

That’s it for this month, I’ll try to post more frequently than once a month from here on out……probably a good idea, given the shifting landscape.

Social media is quite the darling thing these days isn’t it? Has anyone figured out how to use it for Real Estate effectively? (Check out the Video)

Sure, in some big cities, I even saw a guy in vancouver who has a facebook page and all his clients fanned him…..yeah, like that will work out here.

How should social media platforms work out here in Real Estate? Here’s what I’ve been working on, and so far, it seems to be working ok for me……

1. Don’t use FB for Business, especially Real Estate business! It just doesn’t work. Far better is linked in.
2. I’ve been using twitter personally, (mauim) and I just started to real estate tweet. (copperwesthr) I can see some great use there, but I’ve not revved it up yet.

That’s as far as I’ve gotten……Social media seems like a great tool for this marketplace, it’s just how it’s deployed that matters. What really matters, though, is that going forward, you have to be conversant with Social Media platforms and networking to be effective in this day and age. A simple cell phone isn’t going to cut it anymore.
Stay Tuned!

Get Ready! More laws coming down the pipe! (watch the video or read below)

HERA (The Housing and Economic Recovery Act) has amended the Truth in Lending act. This matters to everyone because it will change the way we all do business. The way deals will get put together will change, and it will put people in a tailspin if they aren’t ready.

Here’s the highlights:

1. Requires timeline of 7 business days from receipt of initial mortgage disclosure to closing
2. Requires Three business days from receipt of appraisal to closing
3. If the rate on your loan changes by more than 1/8th of a percentage point, a new lending disclosure is required, and there is an additional 3 day timeline.

There are other elements to the amendments to the Truth in Lending act, but these are the most impactful. If you look at it from a consumer protection framework, this makes sense. That is, of course, if you believe that the banks were entirely the bad guys, which I can tell you from experience, is not entirely the case.

My Friend Ron Kurahara was talking to me about the spike yesterday in mortgage rates. I’m a pretty strong beliver in the inflation scenarios, so I was listening. When I got back to my computer, Another Friend had sent me this commentaryoff the Mr. Mortgage Blog. It’s about what that spike actually meant. I can tell you, I’m living about ahlf that blog post, so it’s very succint, and very Accurate.

Check it out.  And if you like the link, share it off our site or tweet it, or otherwise send some props our way……Our SEO work could use it! 

The Hood River Real Estate View from Here Blog for May 2009….

Here’s the transcript from the Video!

Slow month this last month, the rain didn’t help at all. It started up, then pullled back. We are now reassembling.

Memorial Day in Hood River is turning out to be nice, and windy…..Love it!

Traffic is down slightly in Town, but still pretty strong.

The New York Times Article on Hood River that mentions Copperwest is still having an impact.

Tricky getting deals through, but things are hapening!

That’s it for this month! See you soon!

Check out our new Hood River Real Estate Resource Center!

Here’s the deal:

1. There is no easy clearing house for Hood River Rental Real Estate that works in both directions
2. Copperwest is right downtown, and we have so many people looking to lease and looking to lease their homes that we thought….
3. If we helped connect the Leasees and the Lessors, that would probably be a good thing.
4. So come in, if you are looking for a place to lease, or have a place to lease. When you post something, we’ll leave it up for about a month.
5. If you have a place to lease, you can post, and then call the people who are looking
6. If you need a place, you can post, and then call the people who have a place.
7. Yes, we know it’s not very high tech. Remember. Free is a very good price.

Here’s the video version of the view from here!

The written breakdown:

1. Good month for Hood River Real Estate

2. Underwriting continues to be tricky

3. Some Hood River Westside neighborhoods have “written down” in value

4. But Prices for Hood River Properties in general have been getting very attractive, and with interest rates being low, along with soft prices…….

Well, you get the picture! See you next month!

Check it out!

Click Here to see the “Havens” Article in the New York Times on Hood River.

The Home Valuation Code of Conduct is going into effect on May 1st. Here’s a quick breakdown of what it is.

For more information, go to this post, I put a link here for people who want to read the whole thing. It’s only seven pages, and the FAQ sheet is pretty comprehensive.

We are going to try something new this month. Video blog entry. See what you think.

The breakdown is as follows:
Buyers are still waiting for a signal to move off the sidelines
In a slightly declining market, the best Seller’s strategy is to “get ahead of it” on price
This is causing some areas in town, to reset.
Makes for an interesting time right now!

Attended a few meetings last week: Take Aways were:
1. Rural is a cool place to be right now. Lots of interest and inbound residents
2. Pent up Buyer pool will firm up prices once they start moving off the sidelines.

IR-2009-14, Feb. 25, 2009

WASHINGTON — The Internal Revenue Service announced today that taxpayers who qualify for the first-time homebuyer credit and purchase a home this year before Dec. 1 have a special option available for claiming the tax credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year.

Qualifying taxpayers who buy a home this year before Dec. 1 can get up to $8,000, or $4,000 for married filing separately.

“For first-time homebuyers this year, this special feature can put money in their pockets right now rather than waiting another year to claim the tax credit,” said IRS Commissioner Doug Shulman. “This important change gives qualifying homebuyers cash they do not have to pay back.”

The IRS has posted a revised version of Form 5405, First-Time Homebuyer Credit, on IRS.gov. The revised form incorporates provisions from the American Recovery and Reinvestment Act of 2009. The instructions to the revised Form 5405 provide additional information on who can and cannot claim the credit, income limitations and repayment of the credit.

This year, qualifying taxpayers who buy a home before Dec. 1, 2009, can claim the credit on either their 2008 or 2009 tax returns. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.

The amount of the credit begins to phase out for taxpayers whose adjusted gross income is more than $75,000, or $150,000 for joint filers.

For purposes of the credit, you are considered to be a first-time homebuyer if you, and your spouse if you are married, did not own any other main home during the three-year period ending on the date of purchase.

The IRS also alerted taxpayers that the new law does not affect people who purchased a home after April 8, 2008, and on or before Dec. 31, 2008. For these taxpayers who are claiming the credit on their 2008 tax returns, the maximum credit remains 10 percent of the purchase price, up to $7,500, or $3,750 for married individuals filing separately. In addition, the credit for these 2008 purchases must be repaid in 15 equal installments over 15 years, beginning with the 2010 tax year.