This year, prospective home buyers in Dallas and across the country were offered a first time home buyers tax credit of up to $8,000 (or ten percent of the purchase price) for the purchase of a home. First time home buyer is defined as a buyer or buyers who have not owned a home as a primary residence within three years of applying for this tax credit. To maintain this credit, the buyer or buyers must reside in the home for three years. This home, or primary residence, is defined as a single-family home, condominium, townhouse, or co-op. To qualify, the income had to be between $75,000 and $95,000 for a single and $150,000 and $170,000 for joint filers, the maximum benefits being applied to the lowest of the limiting income levels.

This tax credit is due to expire on November 30, 2009, and anyone taking advantage of it must be in residence by December 1st. However, there is currently an effort underway by Republican Senator Johnny Isakson, of Georgia who has been joined by Democratic Senator Chris Dodd of Connecticut, sponsoring a bill to extend this credit into June of 2010 and to expand it to include all buyers. Echoing this interest in extending the tax credit as well as revising it to include higher income limits and larger credits, The Mortgage Bankers Association (MBA) the National Association of Realtors (NAR) and the National Association of Homebuilders (NAHB) recently sent a letter to top officials in the Obama administration asking for an extension. They cite the benefits to the economy in the form of increased housing sales and the subsequent effects as more employment opportunities arise and seep into the fractured economy.

The delicate state of the housing market and the fact that almost 1.4 million first time buyers have qualified for this tax credit as of August 2009 is the reason for the interest in extending the length of this program. While home sales in the Dallas area haven’t been as adversely affected as those in other parts of the country, the more expensive houses, beyond the price range for those who qualify for the tax credit, remain unsold. If the government does offer the extension along with a few revisions to include a wider portion of the population, these more expensive homes could become eligible for tax credits. This could further revamp the housing market in Dallas and throughout the nation and help on the road to our economic recovery.