Who Cares About the 1st Time Home Buyer's Credit?

Real Estate Agent with William Raveis Real Estate

Well it's very clear that the $8000 First-Time Home Buyer's Credit is a success.

OK - you're not eligible for the credit because you're not a first time home buyer so why does this matter to you?

Simple answer - as the housing market gets better it helps the economy get better. 

The inventory of unsold houses decreases, so the people who own them begin to move on and, in many cases, buy new houses. 

The sellers are freed up to invest profits back into the economy. In addition to buying new houses, they hire moving companies, buy new furniture and new electronics. They hire decorators. They hire contractors to remodel. They spend money at home improvement stores.

The home improvement stores, the furniture stores, the electronics stores, the re-modelers and the moving companies stop laying off people and actually hire new workers.

The government spends less paying out unemployment checks.

The newly hired people put money back into the economy.

The retailers who have improved business, make more money, which they invest back into the economy by opening new stores and buying more inventory, which helps the manufacturers who sell them the inventory.

Then the manufacturers start making more money and hire more people who start earning money and - you guessed it - put it back into the economy.

So, when you hear the news about the success of the 1st Time Home Buyer's Credit - remember - it helps all of us.



Comments (2)

David Monsour
Keller Williams Keystone Realty - Gettysburg, PA
ABR - www.realty-insights.com

Pretty basic, but it's the truth.  The housing market has a bigger grip on the economy than most people realize.

Oct 03, 2009 03:30 AM
Rick Schwartz
William Raveis Real Estate - Danbury, CT

Thanks David - I've never been one to shy away from stating the obvious :)  Seriously though, I think it's always worth reiterating the basics - sometimes people forget.

Oct 03, 2009 03:39 AM