Yes! Our fearless Governator, Arnold Schwarzenegger, just signed AB 183 which will enact a first-time home buyer tax credit for the lesser of 5% of the purchase price or $10,000. The effective date is to be May 1, 2010, deliberately starting one day after the federal tax credit requirement to be in contract ends.
$100 million is being allocated to existing homes and another $100 million is being allocated for new construction or previously unoccupied homes. Unlike the federal tax credit, California's credit will be evenly distributed over a period of three years. Another requirement is that the first-time home buyer must live in the residence for at least 2 years, or they will have to repay the State.
The previous tax credit program that California had only applied to new homes, and the allocated money ran out eight months before the program was set to expire. There is a lot of hope that this new tax credit will stimulate new jobs within California's housing market. This is great news for Californians who qualify for the first-time home buyer program.
Way to go, Arnold!
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Cynthia Larsen
Broker/Owner - Safe Haven Realty
Sonoma County, California, USA
(707) 332-2560
Hopefully it will provide some consistency to the market, rather than the big drop we are all bracing for when the federal credit expires.
I'm hoping so too, Stacey-Ann. We've been dreading a horrible summer without either a federal or state tax credit. I was soooo excited when I received the email from CAR.
Leave it to Arnold to create something that will get the real estate market functioning again.....it always starts in California and Massachusetts is the last to blend in.
Barbara - This is Arnold's last term, we are voting for a new Governor in November. I think he is trying to accomplish a lot during his final months. No complaints here!!
Cynthia,
This is great news! Way to go Arnold...
Michael - I'm already e-mailing my first-time home buyers with this breaking news. I can see them pulling themselves out of their depression and looking at listings I have been sending them. This sure puts a whole new light on our real estate market this summer. woo hoo!!
With the economy so bad there, from what I've read how did anyone manage to allocate $200M?
Carla - good question and one I can't even begin to answer. This is where I stick my head in the sand and hope for the best because I am just a lowly pawn in the scheme of politics.
Oh my gosh, I hadn't heard this, that's great news.