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Feds’ latest move may lift Valley home sales

Feds’ latest move may lift Valley home sales

The Arizona Republic

November 6, 2009

An expanded version of the home-buyer tax-rebate program could jump-start the market for higher-priced homes and help sustain the booming low-end housing market, Phoenix-area real-estate analysts say.
Home builders, analysts and brokers said they hope the revamped program, expected to receive President Barack Obama’s signature today, will spur sales of homes priced from $250,000 to $800,000 by extending tax relief to some existing homeowners and to households with combined income of up to $225,000.

Potential first-time buyers who may have hesitated or could not close on a house in the program’s first phase also get a second chance to do a deal. And significantly, existing homeowners who are in the move-up market now will be eligible for a credit under the new legislation. “I think this will undoubtedly give that midrange a shot in the arm – at least temporarily,” Scottsdale-based luxury home builder Michael Ripson said.

Ripson, owner of Ripson Homes, opened a subdivision in April near Sun City, northwest of Phoenix, hoping to sell homes priced from $265,000 to $355,000.

He has yet to complete the community’s first sale, but Ripson said the expanded tax rebate would make him confident enough about the future to build a couple of speculative homes at the 120-lot Sonoran Acres.

More importantly, Ripson said, news of the broader eligibility guidelines gave his lender the confidence to finance the construction of spec homes by Ripson Homes, which didn’t happen under the original rebate
program.

“We’re slightly out of the first-time buyers’ price range,” Ripson said.

The original tax rebate of up to $8,000 took effect in February but could be applied retroactively to homes purchased since the beginning of the year. Only residents who had not purchased a home in the previous
three years qualified, and there was an income limit of $95,000 for an individual and $170,000 for a married couple.

The expanded program, which would take effect Dec. 1, would allow repeat home buyers who bought their previous home at least five years ago to claim the le51sser of 10 percent of the home’s sale price or $6,500. It
also would raise the income limit for either rebate to $125,000 for individuals and $225,000 for couples.

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