The housing supply is finally starting to catch up with the demand, as inventory (for-sale listings) continued to grow in July. Sales prices rose 7% year-over-year) and searches about buying a home are at an all-time high, indicating interest among homeowners and would-be homeowners remains stable. This report also listed the 20 hottest mid-to-large real estate markets in the nation, based on listing views and time on market figures. Six of the top 10 markets are located in California, and the full list from Realtor.com included:San Francisco, CA Denver, CO Dallas, TX Vallejo, CA Santa Rosa, CA San Jose, CA Midland, TX San Diego, CA Ann Arbor, MI Santa Cruz, CA Detroit, MI Sacramento, CA Stockton, CA Yuba City, CA Columbus, OH Austin, TX Los Angeles, CA Oxnard, CA San Antonio, TX Fort Wayne, IN
While markets are heating up, thanks to rising prices and fast-moving listings, housing guru Ken Harney notes that Congress has started work on approving many popular tax credits designed to make homeownership even more attractive. Since they are technically 'temporary,' the following credits must be approved each year, or they will expire. Last week the Senate Finance Committee voted to approve the following extensions:
- Retroactive extension of the Mortgage Debt Relief Act, allowing homeowners that are facing foreclosure the opportunity to work out a short sale with their lender and will not be hit with a huge (and unwelcome) tax bill. Without the exemption, the amount 'forgiven' by the lender is considered taxable income.
- Approval of tax credits for energy-efficient home improvements, such as new windows, insulation, and appliances. This measure alone could save homeowners an estimated $700 million in taxes during 2015-2016.
- Extending the deductibility of mortgage insurance premiums - This one is of particular importance to first-time homebuyers and middle-income individuals. Since mortgage insurance is typically included in loans made through government-sponsored entities like the Federal Housing Agency (FHA), and it only applies to those with incomes of $100,000 or less.
While the news is great for homeowners (and would-be homeowners!), don't break out the champagne yet. Congress has much on its 'to-do' list, and if previous years are any guide, the bill may not be approved until December. Stay tuned.