With the Federal $8,000 first time home buyer tax credit coming to an end on April 30, 2010, the new California home buyer $10,000 tax credit comes into play from May 1, 2010. However, based on latest California Association of Realtor forecast, the California tax credit which is capped at $100 million is expected to be exhausted between May 10 and May 20, 2010–just 10 to 20 days from the initiation of the program. Assuming a typical minimum of 30 days for escrow, that means you won’t get the California tax credit unless you are already in escrow before April 30, 2010–which means the lucky 10,000 or so will get both the Federal $8,000 tax credit and the California $10,000 tax credit for a total of $18,000!
So, how is this California tax credit supposed to be a stimulus? It sounds like just a gift to a lucky few who were already rushing to get the Federal tax credit.
There were some discussions that the California Tax Credit can be reserved but that has been clarified to apply only to New Never-Occupied Homes and does not apply to existing homes.