Generation Y is getting jazzed about a new $8,000 federal tax credit for first-time home buyers-jumping at the opportunity to move up and out of their rentals.

"The last 90 days I've seen it go crazy," Kevin Foster, a real estate agent with Reece & Nichols in Lee's Summit, said Tuesday. "Every conference room has been full with agents working on offers, and many are people in their 20s."

Peter Abbey, 26, and his girlfriend, Abigail Barnett, 27, were among them.

Abbey, bar manager at Avenue Bistro in Kansas City, and Barnett, a hospital administrative assistant, had been saving to buy a house the past couple of years but weren't quite there yet. Until Congress approved the expanded tax credit in February.

Now they're leaving their rented home in the city for their own place in Roeland Park.

"We were saving money and waiting for the right time, and that definitely helped give us a push," Abbey said. "We were able to buy a little bit earlier because of the government tax credit."

The Kansas City Regional Association of Realtors® said April sales of new and existing homes were up 10% from March, with almost 2,500 homes sold. "We're seeing a lot of first-time buyers back in the market again," said Chris Collins of Keller-Williams and president of the association. "The tax credit along with historically low mortgage rates is affecting the market."

The tax credit was part of President Barack Obama's $787 billion American Recovery and Reinvestment Act. It's available to people buying their first home in 2009 as long as the purchase is completed by Dec. 1.

Because of the one- to two-month lag between a contract and a done deal, many home buyers are making offers on homes now.

As opposed to a $7,500 tax credit available in 2008, the latest incentive doesn't have to be repaid if the taxpayer remains in the home for at least three years.

At the national level, a report Tuesday said pending home sales in April were up 6.7% from March, the biggest monthly increase since October 2001, according to a seasonally adjusted index of sales contracts kept by the National Association of Realtors®. Continue reading on RISMedia.com...

by Kevin Collison

More Tax Credit Resources

• Tax Credit Information and Home Buyer Resources FROM REBAC

• The Basics: 2009 First-Time Home Buyer Tax Credit

• HUD: Tax Credit Can Be Used on Closing Costs