That near-perfect timing could continue for first-time homebuyers: the tax credit of up to $8,000 has been extended into 2010. Eligible taxpayers who purchase a home by April 30 (and close by June 30) can claim the credit on their 2009 taxes. So if you’ve been on the fence wondering if now is the time to buy a Chicago home, this tax credit provides an opportunity we likely won’t see again.

But what if you already own a home and are looking to purchase another? While much of the tax perks have been extended to first-time buyers, repeat homeowners have their own incentive for real estate purchases—a separate tax credit of up to $6,500. Homes purchased for less than $800,000 are eligible for a tax credit of 10 percent of the purchase price if buyers have an income of less than $225,000 (for married taxpayers). Even those with an income of up to $245,000 (for married taxpayers) may qualify for a credit along a “phaseout” range based on your modified adjusted gross income.

Those looking for a good value in the purchase of a Chicago home or Chicago condo could be perfect candidates to take advantage of this tax credit. The home you are selling must have been your primary residence for five years in order to qualify. Buyers must be in a contract to purchase the new home before April 30 in order to claim the credit on 2009 taxes. If the purchase doesn’t close before tax day, you may need to request an extension or amend your return later in order to file for the credit.

And finally, there is also a tax incentive for Chicago home owners who aren’t looking toward a real estate purchase. Instead of purchasing a new home, making “green” improvements to your primary residence could qualify you for a tax credit of up to $1,500. The credit is available through 2010. Eligible changes include things like installing energy-efficient windows or heating systems, and the residential energy property credit could return up to 30 percent of the cost of improvements.

If you’re ready to take advantage of these limited-time tax incentives and see what the Chicago real estate market has to offer, please contact agent Sheldon Salnick at (312) 264-5853 or email him at ssalnick@rubloff.com.

It’s clear that first-time home buyers have been having a major impact on the housing market this year. The National Association of Realtors announced that first-time buyers, who typically account for less than 40% of home sales each year, have been especially busy…in March, homes that were purchased by first-timers accounted for 53% of all sales, and this percentage is expected to hold true for all of 2009.

With home affordability higher than ever, available tax credits and some of the lowest interest rates ever recorded for home loans, who can blame them? Particularly as a first-time buyer, there may never be a better time to buy a home than right now.

However, the availability of a tax credit, while a great incentive, does not put the money in the hands of a buyer right away. HUD’s announcement now allows for prospective and qualified home buyers to borrow the money based on the the $8,000 tax credit (known as a bridge loan) from approved agencies and lenders so that they have money for closing.

While details of participating lenders and HUD-approved agencies are not yet available, this should turn up the heat on prospective buyers to get busy searching for their next home. As further details become available, I will get them to you.