Lots of news today about housing, real estate, tax credits, and rescued borrowers.  Let’s start with the extended and expanded Worker, Homeownership, and Business Assistance Act of 2009 that was passed by Congress and signed by President Obama last Friday.  The measure extends the $8,000 tax credit June 30th for first-time homebuyers.  The home being purchased must be under contract no later than April 30, 2010 and there are other requirements including income and a maximum purchase price.

In addition, the law expands coverage to include current homeowners who have owned a home for at least five of the last eight years.  The same income and purchase price limits apply, but existing homeowners will receive a little less – $6,500 tax credit.  Afraid it’s not enough?  U.S. News & World Report says,

In the hopes of sustaining the real estate market’s recent momentum, Uncle Sam has made more than two-thirds of current homeowners and nearly all first-time buyers eligible for thousands of dollars in tax perks when they purchase a house.

Another big criticism we’ve heard recently is that the loan modification plan didn’t do enough to help homeowners.  Now I’ll line up with some of that criticism in that it only helps people who are behind on their house payments – so you have to be two months behind or facing imminent foreclosure to get help.  No aid for those of us who are struggling to yet still making our monthly mortgage payments.

However, the plan is reaching one out of five borrowers in trouble (as defined above),

More than 650,000 borrowers, or 20 percent of those eligible, have signed up for trials lasting up to five months, the Treasury Department said Tuesday. The modifications reduce monthly payments to more affordable levels.

I’d like to see this expanded to help those who may starting to fall behind before their credit is damaged.

We’ll end with news that is more grim – that home prices continue to fall in cities.  According to MSNBC.com, sales are on the increase but values are still going down.

The median sales prices of existing homes declined in 123 out of 153 metropolitan areas compared with the same period a year ago. Prices rose in the other 30 cities.  The national median price clocked in at $177,900, or 11 percent below the third quarter last year.

Experts at the National Association of Realtors attribute this to the large volume of distress sales.  Another wave of foreclosures is on the horizon, so hopefully the boost in the expanded tax credit and outreach for homeowners behind will help curb this prediction.