Does that mean people who lived in their homes for the past five years and want to move on? People who lived in their homes for at least five years after late 2001, have since been renting it out and now want a new primary residence? People who lived in their homes for at least five years after late 2001, sold the place and now want to buy again?

I posed this to a Senate Finance Committee aide, and he said yes. Yes to all three.

I wondered that to begin with, but the "ending on the date of the purchase of a subsequent principal residence" part made me second-guess myself.

I urge you all not to spend that $6,500 before it's a sure thing that you can get it -- let's see what the IRS has to say, eh? But Wonk reader SSK, it does look like you can take advantage of the credit. (SSK posed this question: "I lived in my Baltimore house for 12 years. Just sold it in July. I re-located to Ohio and am renting. I'm about to bid on a new home. So, I lived in my home for more than 5 years, but I'm temporarily renting now. Do I qualify?")

Next Friday, I'll unveil the long-awaited list of hidden-gem neighborhoods -- nice, off-the-radar and relatively affordable spots in the Baltimore region. In the meantime, can you guess the 10? Photos of each are above.

The person with the most correct guesses wins a copy of Our Lot: How Real Estate Came to Own Us by Alyssa Katz. Anyone with at least one correct guess is entitled to a Real Estate Wonk magnet.

Remember, each of the 10 is in the Baltimore metro area and had an average sale price under $250,000 in the first half of the year. More than half were suggested by you lovely Wonk readers.

Two hints: Each Baltimore-area jurisdiction has at least one. And a few of the spots are really communities, not neighborhoods.

You don't have to squint at the photos. Click on any and a larger version will pop up.]]> http://weblogs.baltimoresun.com/business/realestate/blog/2009/11/post_4.html http://weblogs.baltimoresun.com/business/realestate/blog/2009/11/post_4.html Hidden-gem neighborhoods Fri, 06 Nov 2009 08:00:00 -0500 sign it into law today.

The National Association of Realtors says the new provisions -- a longer time frame for the $8,000 first-time buyer credit, higher income limits and a $6,500 credit for certain repeat buyers -- will go into effect as soon as pen hits paper. The trade group has a handy "compare the tax credits" chart that you can find here.

You can also read more about the details on yesterday's tax-credit blog post.

The first-time buyer tax credit, hailed by the real estate industry as a stabilizing force for the battered housing market, has its critics. They say it's a lot of money, much of it going to people who probably would have bought anyway and some of it going to tax cheats (including 19,000 who didn't actually purchase a home). Some of you have said you think it's a stimulus that won't help in the long run.

In this running Wonk poll, I asked you a simple question about the bill: Thumbs up, down or sideways? The voting was overwhelmingly thumbs up at first. But as of last night, the results were split: 49 percent down, 47 percent up and 4 percent sideways. 

I chatted yesterday with Heather Fernandez, vice president of marketing with real estate search engine Trulia. She's enthusiastic about the soon-to-be-law, though not without reservations. One reason to cheer, she said, is that consumers pump money into the economy after buying a home ($30,000 within the first six months on items ranging from furniture to hot water heaters, Trulia found in a study last year). She also thinks the credits will help move more foreclosures and cushion prices in the short term.

There's a significant "but," though: "What happens to real estate demand on May 1?" Fernandez asks. April 30 is the last day you can sign a contract and still qualify for the first-time or repeat-buyer tax credits.

"While this may spur tremendous activity in the short term, what's going to stop demand from dropping off a cliff?" she said.

It seems to be the same proposal we've been talking about for the last few days. Highlights:

--$8,000 for first-timers signing contracts through April 30 and closing by June 30. That credit was due to expire at the end of the month.

--$6,500 for repeat buyers who have "lived in their current residence for five consecutive years out of the last eight," the Los Angeles Times reports. But Sen. Harry Reid's press release phrases it as "those who have owned a home for five consecutive years within the previous eight years." More on this in a moment.

--Individual tax filers making no more than $125,000 and joint filers making no more than $225,000 could take the full credit, a significant increase of the income cap. The credit would decrease in value for people making more than those amounts, phasing out completely after $145,000 for singles and $245,000 for couples, the Times says.

--If the home you're buying is priced over $800,000, you can't partake.

You might be wondering what this "five consecutive years out of the last eight" really means for potential repeat buyers. I did, because it makes a difference whether it's "lived in their current residence for five consecutive years out of the last eight," as the Times writes, or "those who have owned a home for five consecutive years within the previous eight years," as Reid puts it -- or something else entirely.

In the Baltimore metro area, sales in the summer rose a bit faster -- about 8 percent from a year earlier. But there's more catch-up to do: 8.8 months of inventory.

Homes are sitting longer on the market here as well: 117 days in the Baltimore area compared with 81 in the Washington area.

The market decline hit our southern neighbor first, and it started to recover first, too. D.C.'s job market is one of the strongest in the nation, which doesn't hurt.

The Delta and MRIS report also shone a spotlight on neighborhoods around BWI, a market between Baltimore and Washington. It offered some illuminating statistics about what exactly is selling.

For those of you wondering what people with lavish houses do with all the space: Howard County police say a Columbia mansion -- a 4,600-square-foot spread -- was being rented out for a Halloween party this weekend that drew more than 100 people, possibly much more.

They're clear on the "more than 100" part, because that's how many people were still there when officers arrived in response to 911 calls about gunfire. A 19-year-old was killed and a 22-year-old was badly injured.

Police think the house was also rented out for a party that took place in June.

The Sun's Annie Linskey reminded me that several years ago, a big Anne Arundel County house was the site of a non-fatal shooting while rented out to two NFL players. Neighbors complained that the place was being used as an unauthorized nightclub even before that point.

Do you live near homes that are frequently used for parties, with or without cover charges?

(Photograph of the Columbia house by Algerina Perna / Baltimore Sun)

It's a national argument that last week came to Baltimore, during hearings held by the International Code Council. The ICC -- the organization that writes the building-safety rules adopted by states, counties and cities across the country -- entertained a proposal by the National Association of Home Builders that sprinklers be a "mandatory option" rather than a mandatory non-option. (A mandatory option might sound like an impossibility, but it would mean a feature that builders have to offer as an add-on, leaving the choice to buyers.)

Under the ICC's current code, sprinkler systems will be required in newly constructed single-family homes by 2011. The home builders are trying to get that changed, but sprinkler proponents outvoted sprinkler opponents. (Though it's not a done deal until the ICC's conference in May, it was a key vote.)

Sprinklers are already mandatory in all new townhouses in Maryland. Would you want sprinkler systems installed in all new single-family houses? What do you think of them, if you've had up-close and personal experience with them?

Given a choice, would you pay extra to have them in your home?

Almost 80 percent of voters offered a thumbs up. Five percent don't love it or hate it and gave it a sideways thumb. The rest say no thanks.

Some commenters wondered what personal situations were influencing these choices. Sounds like a poll:

Need a refresher? The tentative Senate deal would extend the $8,000 first-time home buyer tax credit -- you could sign a contract through April 30 as long as you closed by June 30. It would also create a new tax credit of up to $6,500 -- starting Dec. 1 -- for repeat buyers who have been in their current homes for at least five years and are getting a new primary residence.

For more details (income limits, price limits, etc.), read this home buyer tax credit post.]]> http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/home_buyer_tax_credits_are_you_in_1.html http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/home_buyer_tax_credits_are_you_in_1.html First-time buyer tax credit Sat, 31 Oct 2009 07:00:00 -0500 --As you probably already heard, the credit would be available to buyers signing contracts through April 30 and closing by June 30. First-timers would continue to be eligible for up to $8,000. Other buyers could get up to $6,500, starting Dec. 1, if they've lived in their current home for at least five years.

--Income limits would be increased to $125,000 for individuals and $225,000 for couples, with the credits phasing out above those amounts.

--Repeat buyers must be getting a primary residence, not a vacation or investment property. But you're allowed to keep your current home.

--Eyeing a home priced above $800,000? You can't get this credit, the senators say.

--Read their lips: No more credits for 4-year-olds. First-time buyer tax credit fraud, including money funneled to preschoolers and to people who didn't actually buy anything, prompted senators to require that buyers be at least 18 and submit copies of their HUD-1 settlement statements when applying for the credit.

News of this extension and expansion touched off a firestorm of discussion here, and emotions of all sorts. Hope among some homeowners who could use $6,500. Frustration among those who would miss out under the proposed restrictions. Aggravation among renters who think credits are artificially propping up the market at taxpayers' expense.

The tentative agreement worked out by Senate negotiators would allow buyers to sign contracts through April 30 as long as they close by June 30. First-timers would continue to be eligible for up to $8,000, while some repeat buyers could get up to $6,500.

Which repeat buyers? "The reduced credit would be available to all home buyers who have been in their current residence for a consecutive five-year period in the past eight years," the WSJ reports.

This hasn't yet passed the Senate, which is trying to decide which other economic measures to tack on to a bill, and it faces skepticism in the House. (As you'll recall, a number of people have allegedly claimed the credit despite not qualifying as first-time buyers, not being old enough to buy a house, not actually buying a house, etc.)

What do you think? Weigh in:

]]> http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/firsttime_and_secondtime_home_buyer_credit.html http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/firsttime_and_secondtime_home_buyer_credit.html First-time buyer tax credit Polls Thu, 29 Oct 2009 09:32:52 -0500 The Center for Responsible Lending, a watchdog group that predicted the national implosion of subprime loans before it happened, has a few numbers it wants you to think about:

--134,923: Maryland homeowners behind on their mortgages at the end of June.

--163,479: Maryland foreclosures it predicts between this year and 2012. (If that comes to pass, it would be one in every seven homes with a mortgage, according to my quick check of Census Bureau data.)

The center has numbers for every state -- under the headline "The Impact of Bad Lending" -- and it's reminding us of this now because it's trying to rally support for the proposed Consumer Financial Protection Agency.

As real estate columnist Kenneth Harney notes, the agency would oversee real estate and mortgage matters, plus "credit cards, debit cards, consumer loans, payday loans, credit reporting agencies, debt collection, stored-value cards and even investment advisory and financial advisory services, to name only part of the list."

Prices in August -- the numbers released Tuesday -- were down about 11 percent from a year ago among the 20 large metro areas Case-Shiller tracks (Washington among them, but not Baltimore). Compare that with a 19 percent year-over-year drop in January. And August prices were up slightly compared with the previous month.

Sean Hannon at the Seeking Alpha blog is not impressed. "If artificially low interest rates, home buyer tax credits, and foreclosure moratoriums could not drive prices higher and lead to a boom in home sales, what hope is there for a stimulus-free recovery?" he asks.

David M. Blitzer, chairman of the index committee at S&P, also had words of caution in a statement released with the numbers. He noted the planned expiration of the first-time buyer tax credit after Nov. 30 and "anticipated higher unemployment rates through year-end."

"Both may have a dampening effect on home prices," Blitzer said.

Forget the analyst-speak and macroeconomics for a moment. What do you want to see to convince you -- as a homeowner or renter -- that the housing market has recovered? Prices no longer dropping? Prices increasing a certain amount? Prices back to their 2006-or-so peaks? Or something else altogether?

And are you holding off on doing something -- buying, selling, renovating, job-hunting -- until you see it?

We're not back to a pre-bubble balance between new contracts and new for-sale listings, though. Here's a graph that tells the tale, showing stats for the month of September throughout the decade:]]> http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/home_buying_and_selling_in_the_baltimore_area.html http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/home_buying_and_selling_in_the_baltimore_area.html Housing stats Tue, 27 Oct 2009 07:00:00 -0500 To remodel or not to remodel? It's a question that bedevils homeowners who don't have the answer staring them in the face, i.e. "might as well redo the master bathroom as long as we're fixing the flooding caused by the hole in the roof." Falling home values make the situation that much harder because many folks who might want to update their kitchen or build an addition don't have the equity to do it.

Thus renovations and maintenance work have taken a hit just like home sales. As Lorraine Mirabella reported in a Sunday story about the remodeling business:

Residential permits for alterations, additions and repairs have plummeted 27 percent in metro Baltimore this year through August, compared with the corresponding period in 2008, according to statistics from the Baltimore Metropolitan Council. The number of permits issued through August - 4,552 - has fallen by nearly half since 2006, when activity for the January-to-August period peaked at 8,250 permits, council statistics show.

Some remodeling companies are seeing an increase in business -- one firm recently did work for a customer who'd bought a foreclosure and needed to fix it up, for instance.

All this makes me wonder how many people would be knee-deep in home-improvement projects if this wasn't a down housing market and rough economy. Hmm ... sounds like a poll:

If you're eying a home-improvement project purely because you want to sell soon, keep in mind that your return on investment will probably be negative. At least that's what real estate agents have found since the bubble popped.]]> http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/remodeling_in_a_down_market.html http://weblogs.baltimoresun.com/business/realestate/blog/2009/10/remodeling_in_a_down_market.html Mon, 26 Oct 2009 07:00:00 -0500

Photograph of Massachusetts scene from Library of Congress collection, via Flickr

Home sales drop as the weather turns cold, but does that mean people actively dislike buying in the winter?

I asked you in the most recent Wonk poll, and some of you said yes. But -- take heart, ye would-be sellers contemplating the arrival of the slow season -- not the majority.

The most popular answer, with 39 percent of the vote, was "time of year doesn't matter to me" when it comes to buying or selling a home.

Twenty-two percent of you opted for "anytime except winter." On the other hand, seven percent prefer winter over any other season for buying or selling.

Seventeen percent prefer spring.

Ten percent prefer summer.

And five percent prefer fall.

As MrRational noted in a comment on the poll: