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Last week, Congress extended and IMPROVED the homebuyers tax credit.  First-time homebuyers – anyone who hasn't owned a home in the past three years – will still get up to $8,000 to apply against their federal tax liability, but buyers who have owned their current homes at least five years will also be eligible for tax credits of up to $6,500. To qualify, buyers must sign a purchase agreement no later than April 30, 2010 and close by June 30.

Just as important, if not more so for homebuyers in California, the extension also raises income ceilings. The new version has the credit phasing out for individuals with incomes above $125,000 and for joint filers with incomes above $225,000. The phase-out increase means the new credit will be applicable to higher-priced homes (though the purchase price can't exceed $800,000); thus, stimulating sales in more expensive categories.