After much speculation within the industry, news out of Washington D.C. this week confirmed that Senate is moving forward on extending the $8,000 first time home buyer tax credit. The Senate still has to approve the measure; however, it appears to have bi-partisan support amongst Republicans and Democrats.

The latest version would offer a slightly lower credit of 10% of the purchase price with a maximum payout of $7,290. As long as the home you are purchasing has a price of $72,900 or higher, you will receive the full credit. That is still a nice credit for buyers to enjoy. The median home price here in the Las Vegas real estate market is around $140,000, so most buyers will qualify for the full credit. The tax credit is limited to individual buyers earning $75,000 or less and married couples who earn less than $150,000 per year. Buyers would have to be in contract to purchase a home no later than April 30th, 2010 and must close on their home no later than June 20th, 2010.

The credit is also being expanded to include current homeowners looking to purchase a new home may also qualify for a credit. They must have been living in their current residence for a minimum of five years. Individuals earning over $125,000 and couples earning over $250,000 per year would not be eligible.

Las Vegas Real Estate sales of single-family homes, condos and town homes hit a record of 4,702 in June, beating the previous record of 4,414 set in June 2004 according to the information released by the Greater Las Vegas Association of Realtors.  The main reason for the increase in home sales is the average sales price of $140,000 which is considerably less than the average sales price of $242,000 in June 2004.  The drastic drop in home prices has made it affordable for first time home buyers once again and lucrative for real estate investors.

Majority of the Las Vegas Properties that sold in June were single family bank owned homes and short sales.  Condo and town homes also saw an increase in sales compared to June 2008.  This can also be attributed to the drop in the average sales price which is bringing real estate investors to the Las Vegas Real Estate Market.   Many real estate investors are buying condos with cash and then placing them on the market for rent with a Las Vegas Property Management Company.

Now that Banks and Lenders have lifted the moratorium, we should see a rise in bank owned homes hitting the market over the next 5 to 7 months.  This should fuel homes sales even more as many real estate agents are receiving multiple offers on their bank owned home and even short sale listings.  The bad news is the increase in bank owned homes for sale could drive down the average sales price even further as Banks and Lenders price the properties below market value for a quick sale.  Either way, don’t expect Las Vegas Home prices to increase any time soon.