Good news! It appears we are getting closer to an approved extension of the Home Buyer Tax Credit. According to Foxnews.com this morning the Senate reached a tentative agreement to extend the tax credit for first-time home buyers.
Fox says "The agreement would extend the existing credit for first-time home buyers, worth up to $8,000, while offering a new credit of up to $6,500 for some existing homeowners, Senate aides said. The reduced credit would be available to all home buyers who have been in their current residence for a consecutive five-year period in the past eight years."
The success of the the current Tax Credit cannot be overlooked based on the higher than expected GDP numbers announcement today. Even though the portion of the GDP growth that can be attributed to the Home Buyer Tax Credit may be misleading because of the loss in tax revenue, the fact that it has helped the housing market get poised for a recovery is hard to refute.
According to Fox "The new provisions are aimed at broadening availability of the credit beyond first-time buyers and giving the weakened real-estate market a bigger boost while preventing real-estate investors from benefiting. The credit would be extended from its current expiration date of Dec. 1 to all contracts entered into by April 30, and closed before July 1. It is expected that income limits on people claiming the credit would be increased to $125,000 for singles and $250,000 for couples, from the current $75,000 and $150,000, aides said. The credit phases out for people making more than those amounts."
"While Senate lawmakers appear to have reached a deal on the substance of the tax credit, they are still at odds over how it would be brought to the Senate floor. Senate Majority Leader Harry Reid (D., Nev.) hopes to add it to a bill currently on the Senate floor to extend federal unemployment insurance benefits. But agreement on that hasn't been finalized" Fox states.
Let's all keep our fingers crossed that this will be resolved soon and that the momentum that we are building in the housing market, albeit slow, will continue! In my opinion, if the Govt. is already speanding the money we don't have, it is better used in the housing market where there is a trickle down benefit to multiple sectors of the economy, ie. retailers, building material suppliers, tradesmen, etc., rather than the cash-for-clunkers program which benefited few.
Author: Randall Filbert, MPA www.LendingIdaho.com www.FamilyGuideToFinances.com
This blog's intention is to provide inspirational stories as well as historical accounts and insight into matters concerning the mortgage and real estate markets. These are my opinions and should not be regarded as factual data.