At first glance, it seems like a wonderful idea, to provide an incentive for first time home buyers to get a refundable tax credit for purchasing a home. But what is the logic in applying this credit to first-time buyers only?
After all, first time home-buyers are the ones most likely to default on their loans. They have little or no experience with maintaining real estate or making adjustment for increased real estate taxes or hazard insurance.
Isn't this one of the problems that got us to where we are? The simple fact that someone can buy a home and put a wad of cash in their pocket is just another invitation to disaster.
If the government really want to open the real estate market, the credit should be allowed across the board, There are many sellers right now who might be able to sell their homes if they knew they could recover a potential net loss on the selling side with a credit on the purchase of their next home.
Think of the possible foreclosures that could be avoided, and how much activity would be stimulated in the resale market. When the bottom line is improved, many would be motivated to action.
So let's not repeat the mistakes of the past. Let's put this money where it will do some good ... with experienced homeowners that might just need a little subsidy to avoid a shortfall.
If this credit were applied across the board, I believe the market would recover in six months.
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