By Extending Homebuyers’ Tax Credit, Congress Can Keep Housing Momentum Going
September 16th, 2009 categories: Economic Recovery, For Buyers, For Homeowners, Taxes
Pres. Obama and Congress have passed a lot of legislation to help the national economy work its way out of its long recession. Few have been as successful as the first-time homebuyer tax credit.
As you probably know by now, this piece of legislation provides an $8,000 tax credit to first-time homebuyers. Personally, I believe that this credit has been a major factor in the housing recovery we are now seeing. First-time buyers are an important part of any housing market. And the $8,000 tax credit is spurring a greater number of these first-timers to get off the fence and make offers on condominiums and single-family homes.
Unfortunately, this tax credit comes with an expiration date. Any home sale that closes after Nov. 30 of this year will not qualify for the tax credit.
Chicago Tribune columnist Mary Ellen Podmolik addressed the first-time homebuyer tax credit this Sunday. In her column, she mentions that the housing industry can be expected to place pressure on Congress to extend the tax credit past the Nov. 30 cutoff point.
Not only do members of the real estate community – including REALTORS®, mortgage lenders and home builders – want Congress to extend the credit, they want legislators to expand it. They’d like to see them raise the credit to $15,000 and make it to available to all home buyers.
Personally, I’d love to see this. There’s no doubt in my mind that extending the tax credit will add even more fuel to the housing recovery we’re already seeing.
Podmolik does cite some concerns in her column. She wonders if there is still a need for any home-buying tax credit now that the housing market seems to be in recovery mode.
It’s important to remember, though, that this is still a relatively young recovery. Yes, home sales in Chicago have risen for six straight months. But there is still much room for improvement.
Extending or, even better, expanding the first-time homebuyer tax credit is one way to guarantee that the housing rally continues both here in Chicago and across the country.
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