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The National Association or Realtors® recently released a TV ad with a family sitting in front of a beautiful colonial home, asking each other "What are we waiting for?" It was a national advertisement, but couldn't be more appropriate to San Diego.

With new and existing home prices at rock bottom and the low-hanging fruit of foreclosures around every corner, now is a great time to buy. Both the Federal and State governments have sweetened the pot with buying incentives and makes it easier than ever with buyers' commissions reduced by one-third. Here's an explanation of the benefits available to you.

Federal Tax Credits

The IRS will give an $8,000 tax credit to anyone buying a new home between January 1 and December 1, 2009. Unlike the $7,500 tax credit introduced in 2008, this does not need to be repaid! To be eligible, you must meet the following criteria:

  • You need to be a first-time buyer. This also includes buyers who haven't owned or co-owned during the three years preceding your closing date in 2009.
  • For example, if you sold a home on April 1, 2006, you'll want to make sure that your new closing date is April 1, 2009 to qualify for the $8,000 credit.
  • Unlike in past years, the 2009 program allows you to finance your purchase with state and local tax-exempt mortgage revenue bond programs.
  • The home must be your primary residence for three years.
  • There are income restrictions. If you're single, you can make no more than $75,000 in adjusted gross income. For couple filing jointly, the cap is at $150,000.

California Tax Credits

When the California State Legislature finally passed its budget, they added a great incentive for buyers of new homes. Basically, it mandates that anyone who buys a home that is new construction, between March 1, 2009 and March 1, 2010, will get a $10,000 tax credit.

Following are the state criteria:

  • The $10,000 tax credit is not a loan and if the home remains your primary residence for two years or longer, you do not have to pay any portion of the tax credit back.
  • Again, the tax credit is for new homes only. You will not qualify for the state tax credit if you buy an existing home.
  • The tax credit is good for 5% of the home's price or $10,000, whichever is less. If you buy a new home that costs $100,000, your credit will be $5,000; a $200,000 purchase entitles you to the maximum credit of $10,000 (5% of the purchase price). If you splurge on a new home that costs $350,000 your credit will still be $10,000 as the credit is only good for 5% of the home's purchase price.
  • Home buyers will receive the tax credit, in equal amounts, over three years.
  • Unlike the Federal Tax Credits, this is available to all home buyers, not just first-time buyers.
  • The home must be your primary residence.

HouseRebate Credit

Now that you know what the government has to offer, we'd like to make sure you take advantage of HouseRebate's savings. When you work with a HouseRebate agent to find your new home, you can count on cash back. You see, we rebate one third of our commission back to you up to 1% of the purchase price. You can use that money for anything you want, it's cash in your pocket; $2,000 on a $200,000 home, $4,000 on a $400,000 home and so on.

The Really Good News

Savvy buyers can combine the Federal AND State Programs for a total credit of $18,000. Add to that HouseRebate's cash back program and you can save a bundle. So, just what are you going to do with all that money?

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