FEDERAL FIRST TIME HOME BUYER TAX CREDIT USAGE (AS OF AUGUST, 2009)
Recently, there has been impassioned pleas from the HBA, NHBA, NAR and other trade organizations seeking the extension of the $8,000 Federal First-Time Home Buyer Tax Credit ("Federal Tax Credit"). Often, we receive questions as to how the Federal Tax Credit is impacting sales in the St. Louis area. Although the statistics vary based on their source, the U.S. Treasury released its August report which indicates that three states - California, Florida and Texas - accounted for 72% of the sales transactions in the nation utilizing the Federal Tax Credit. In Missouri, there has been a modest use of the tax credit with 6,615 closed sales transactions (or 5% of the total national closed sales transactions).
Here are the states with 6000 or more closed sales transactions using the Federal Tax Credit:
Here are the state by state breakdown of closed sales transactions using the Federal Tax Credit:
| State | # of Sales using Tax Credit | % of Total Sales using Tax Credit |
| Alabama | 5046 | 2% |
| Alaska | 485 | 0% |
| Arizona | 9357 | 3% |
| Arkansas | 3021 | 1% |
| California | 42,304 | 13% |
| Colorado | 6210 | 2% |
| Connecticut | 2230 | 1% |
| Delaware | 861 | 0% |
| District of Columbia | 471 | 0% |
| Florida | 29,132 | 9% |
| Georgia | 11,109 | 4% |
| Hawaii | 488 | 0% |
| Idaho | 2457 | 1% |
| Illinois | 9918 | 3% |
| Indiana | 5866 | 2% |
| Iowa | 3455 | 1% |
| Kansas | 3147 | 1% |
| Kentucky | 4105 | 1% |
| Louisiana | 4353 | 1% |
| Maine | 931 | 0% |
| Maryland | 5022 | 2% |
| Massachusetts | 4548 | 1% |
| Michigan | 9237 | 3% |
| Minnesota | 6964 | 2% |
| Mississippi | 2949 | 1% |
| Missouri | 6615 | 2% |
| Montana | 1041 | 0% |
| Nebraska | 2771 | 1% |
| Nevada | 5259 | 2% |
| New Hampshire | 1062 | 0% |
| New Jersey | 5500 | 2% |
| New Mexico | 1466 | 0% |
| New York | 8076 | 3% |
| North Carolina | 9355 | 3% |
| North Dakota | 659 | 0% |
| Ohio | 9172 | 3% |
| Oklahoma | 4300 | 1% |
| Oregon | 3565 | 1% |
| Pennsylvania | 10,250 | 3% |
| Rhode Island | 964 | 0% |
| South Carolina | 4684 | 1% |
| South Dakota | 886 | 0% |
| Tennessee | 8549 | 3% |
| Texas | 29,536 | 9% |
| Utah | 4623 | 1% |
| Vermont | 351 | 0% |
| Virginia | 9093 | 3% |
| Washington | 6229 | 2% |
| West Virginia | 788 | 0% |
| Wisconsin | 5202 | 2% |
| Wyoming | 648 | 0% |
| zz - Armed Forces | 177 | 0% |
| zz - Foreign | 10 | 0% |
| zz - U.S. Possessions | 8 | 0% |
| Total Sales | 314505 | 100% |
TAX CREDIT STRATEGIES
The $8,000 Federal First-Time Home Buyer Tax Credit is set to expire on November 30, 2009. To meet the deadline, it important to get a home under contract almost immediately. However, there are other opportunities to take advantage of the Federal Tax Credit that can close in a shorter timeframe than a sales transaction using conventional or FHA financing. Here are some examples from the St. Louis market:
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100% Developer Financing
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90% Seller Financing
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Short-Term Financing
For those who have started the process late, there are still some great opportunities to take advantage of Federal Tax Credit.
Interested in taking advantage of the Federal Tax Credit in St. Louis, Missouri? Contact Ryan Shaughnessy at PREA Signature Realty at 314-971-4381 to explore alternate tax credit strategies.
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PREA SIGNATURE REALTY
PREA Signature Realty is a full service brokerage located at 1709 Park Avenue in the Lafayette Square neighborhood of the City of St. Louis. PREA Signature proudly serves the following city neighborhoods: Lafayette Square, Soulard, Benton Park, Benton Park West, Downtown Loft District, Forest Park Southwest, Central West End, Tower Grove East, Tower Grove South, Compton Heights, Shaw, The Hill, Dogtown, Carondelet, Holly Hills, St. Louis Hills, Dutchtown, and the Other Historic Neighborhoods of the City of Saint Louis, Missouri.
The opinions expressed herein represent the opinions of the author only and do not reflect the opinions of PREA Signature Realty. All photos and written content were produced by PREA Signature Realty. All Rights Reserved - PREA Signature Realty (2009). This content may not be reproduced or reprinted, except for Active Rain re-blogging, without express written permission of PREA Signature Realty.
For more information, visit our website at www.PREASignatureRealty.com or contact Ryan Shaughnessy at 314-971-4381 or send an email to Ryan@PREASignatureRealty.com.
Interesting stats! I wish we had a tax-credit like that for our first time home owners!
Interesting - I thought the percentages would be higher across the board. However, it seems like more buyers are talking about it now that it is going away!
Wonder what will happen if Congress opens it up to more than 1st-timers?
Liz - At some point, I would love to have a comparison that included a per capita figure and a % of total sales - both by state. I guess it doesn't surprise me that the bulk of these sales are in these 3 states. Some states have under 1000 closed sales using the tax credit.
Kent - I have mixed emotions on the tax credit. It is creating an artificial bubble in the market. We will see what the next couple of weeks bring.
Wow Ryan, What a great blog, Where do you get this great info.. CA and PA really took advantage of the tax credit utah is a little disappointing to me. Again, I hate using your hard work all the time but you do this better than anyone I have seen on the rain. Please forgive me but I need to get this info out to my area to get buyers to realize they're missing out, just one more thing that might get them moving!! You must be the best in your state, thank you so much for this info!! Have a great Monday!!
Debbie - The underlying data is from the U.S. Treasury. I picked it up off a brief mention on Builders.com and followed the link to the Treasury Department. I am trying to create more statistical market reports as opposed to my typical market report. I find taking these look at trends to be interesting. Feel free to use this or any other of my blogs.
Hi Ryan! Interesting stats--I thought that the 3 states with the highest percentage of buyers taking advantage of the incentive would be higher too. I'm not surprised to see those states at the top--they're three of the states with the most foreclosures and short sales--giving first timers more affordable options than normal re-sales.
Have a great week...
Debe - It may not be clear - but the % is the % of all sales using the tax credit and not the % of sales in that state. I would like to get that data - but it would take too much time to track down for me. I agree with your analysis - the states didn't surprise me for the reasons that you stated plus the fact that these states have larger populations and more sales than some of the other states.
Hi Ryan! Yes, your post is clear--I was just saying that the number of distressed, more affordable housing for first-timers, probably contributed to their ability to purchase in these states. But, you're right, population has alot to do with it as well!
Here, the papers are claiming that 25% of our sales are coming from distressed sales, either foreclosures or short sales. Until September, we had no way to measure this data--even in the tax records, a short sale is sold by the homeowner, not the banks (should they be tracking this type of sale through that source). In my guesstimation, if 3% of our sales were from these first-timers (and even all of those weren't distressed purchases) and we doubled that number to calculate the distressed property sales across the board, which I think is generous, 6% is a far cry from 25%!
Have a good one...
Ryan, when I was reading your post the thought came - but these are also the most populated states - and you just said it in your comment. :) Great minds....?
Click on this link and you will see that California is #1 at 33,871,648, Texas #2 at 20,851,820 and Florida #4 at 15,982,378. (In case you're wondering, New York is #3 at 18,976,457.) With the largest populations, these states often lead the pack in trends - good or bad.
The good news is that prices are now back to affordable for many families and qualified individuals and families are finally able to buy a home in the Sunshine State once again.
Sharon - I am going to take a look at the per capita stats. I am curious what percentage of people actually filed an amended 2008 return and how many people have yet to file. I am also curious as to the foreign returns. I never looked to see what properties are eligible.
Debe - Our MLS now tracks short sales and REO properties so it easier to get more reliable statistics on these numbers.