As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed legislation that grants a tax credit of up to $8,000 to first-time home buyers.

Here is more information about how the 2009 First-Time Home Buyer Tax Credit can help prospective home buyers become part of the American dream.

Who Qualifies?

First-time home buyers who purchase homes between January 1, 2009 and December 1, 2009.To qualify as a first-time home buyer the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.

Which Properties Are Eligible?

The 2009 First-Time Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Will the Credit Be?

The maximum allowable credit for home buyers is $8,000.
 Each home buyers tax credit is determined by two factors:The price of the homethe credit is equal to 10% of the purchase price of the home, up to $8,000.The buyer's incomesingle buyers with incomes up to $75,000 and married couples with incomes up to $150,000may receive the maximum tax credit.

If the Buyer(s) Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $75,000 and $95,000 for single buyers and between $150,000 and $170,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying incomeover $95,000 for singles and over $170,000 for couples are not eligible for the credit.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during the three-year period, the credit will be recouped on the sale.

Are housing markets finally turning around? Existing-home sales increased 5.1 percent in February to a seasonally adjusted annual rate of 4.72 million units. The rise seems sharp but comes off exceptionally soft activity in January, so were far from declaring victory. Yet several developments give us reason to hope for a sustainable upturn.
 
 First, the housing stimulus package passed by the federal government earlier this year is working its way through the system. Among other things, it provides a first-time home buyer tax credit of up to $8,000. From this incentive we estimate an additional 300,000 sales this year, plus additional sales as trade-up and trade-down buyers jump into the market. The package also restores high-cost conforming loan limits to $729,750, giving more people access to low mortagage rates.

 When you combine these stimulus efforts with recent action by the Federal Reserve to increase its use of economic recovery funds to buy mortgage-backed securities, mortgage rates could stay at historically favorable levels for some time.

 Affordability also is working for us. Housing affordability levels are at their most favorable mark since the NATIONAL ASSOCIATION OF REALTORS® first started tracking the data in 1971.

 To be sure, some hurdles still exist. Underwriting standards are tough, creating a snag for many households that would like to buy. But those who qualify can lock in low rates and enjoy the upper hand in price negotiations.

Its too soon to tell whether the upturn will last. The home buying process takes several months, so well need to wait until early summer before we know whether everything the federal government is doing is taking hold. But for now we have reason to hope for the best.
 

While sales activity continued a steady month-over-month increase in the Portland metro area, it still fell short of 2008s same month marks for April. Comparing April 2009 with the same month in 2008, pending sales were down 10.1% and closed sales decreased 17.7%.

 New listings also dropped 28.1%. On the other hand, comparing April 2009 with March 2009, pending sales grew 13.6% (1,860 v. 1,637).Closed sales also rose 10% (1,302 v. 1,184). New listings increased 3.3% (3,808 v. 3,685).

 Pending sales continue to rise month-over-month at a steeper than usual rate (13.6% in 2009 vs. 6.8% in 2008 and -2.3% in 2007). Inventory also dropped to 11 months and this is the first time it has dropped from March to April since 2004.

 Active residential listings in April numbered 14,328 - up from 14,158 in March. Sale Prices The average sale price for April 2009 was down 10.4% compared to April 2008, while the median sale price dropped 9.1%.

Month-to-month, the average sale price and median sale price were mixed when compared with
March levels; the average sale price decreased 2% ($291,100 v. $297,000) and the median sale price was up 1.4% ($249,900 v. $246,400).