Checking The Pulse Of The Kansas City Real Estate Market

An estimated 180,000 home buyers (according to my National Association of Realtors) were faced with losing the $8000 tax credit last week. Since the tax credit is no doubt what motivated many of these buyers to go under contract in the first place, it was important that an extension was given for the real estate transactions that hadn’t yet closed. Of course, leave it to Congress to wait until the last-minute to get off their butts and get something done. What they passed is a three-month extension and, although it doesn’t help buyers out currently looking for homes, the bill will save the tax credit for those buyers who were under contract prior to 4/30/10.

This bill was important not just for buyers counting on this tax credit, but also for many home sellers as well. There were many cases where the contracts were written with the stipulation that the transaction must close by 6/30/10 or the buyer could cancel due to loss of the home buyer tax credit — and get a full refund of their earnest deposit.  So everyone wins – except for our children who will no doubt face higher taxes to make up the billions we’ve just given away.

Much of the need for the extension came simply from mortgage lenders being inundated with too many closings at the same time. There were only so many hours in the day for lenders who were closing more deals than they ever had before. There were also many unpredictable Short Sales pushing closings past the deadline. Officially, the new closing deadline for the transactions under contract will be 9/30/10. With $21 billion already on our children’s plates to pay back, I sure hope these additional closings add some stability to our nation’s shaky economy and real estate market.

Posted by Jason A. Brown