On Tuesday, Feb. 17, President Obama signed into law H.R. 1 also known as the American Recovery and Reinvestment Act of 2009. This bill has several provisions that will directly impact real estate here in Alameda County.
- Increased GSE Conforming Loan Limits: This bill raises the conforming loan limits for FHA, Freddie Mac and Fannie Mae loans. While HUD has yet to officially announce the new limits, we estimate that in Alameda County the conforming loan limits for 2009 will be $729,750. Even with the continuing decline in home sale prices throughout many of our communities, prices are still high enough that many buyers have to opt for non-conforming loans with higher interest rates. These higher conforming loan limits will make home ownership more affordable for many buyers in Alameda County and encourage potential home buyers to take advantage of current market conditions.
- Homebuyer Tax Credit: Income-eligible first-time home buyers who purchase a home between Jan. 1, 2009 and Dec. 1, 2009 may qualify for an $8,000 tax credit that could be used against their federal income tax liability. Unlike the $7,500 tax credit available to home buyers in 2008, this new credit will not have to be repaid. Additionally, the tax credit may be used in conjunction with other local and state-funded home buyer assistance programs. To view a detailed presentation prepared by NAR's Real Estate Services division about about the tax credit, please click here.
- Vacant Foreclosed Property Clean-Up: The Housing and Economic Recovery Act passed earlier this year established the $4 billion Neighborhood Stabilization Program (NSP) and the American Recovery and Reinvestment Act pumped another $2 billion into the NSP. The NSP will use the existing Community Development Block Grant program (CDBG) to provide funding to states and local cities for programs to address urban blight caused by vacant and abandoned foreclosed properties. Locally, the City of Hayward already is making plans for how to use these funds - including purchasing and rehabilitating vacant foreclosed homes then reselling them to low- and moderate-income home buyers.
- Residential Energy Efficiency Tax Credits and Grants: According to NAR, this bill provides state and local governments with $6 billion in energy efficiency and conservation grants for energy audits, retrofits and financial incentives. Through 2010, homeowners will be able to claim a 30 percent tax credit for purchases of new furnaces, windows and insulation. Details about this program and how property owners can access the tax credits and grants are not yet available.
Please click here for additional analysis by NAR of the American Recovery and Reinvestment Act.