Question Details

Heather Fern…, Home Owner in San Francisco, CA

Should the $8,000 federal tax credit be extended beyond November 30?

Asked by Heather Fernandez, San Francisco, CA Wed Jul 29, 2009

There is currently a lot of political bickering about whether or not the tax credit should be extended beyond the current Nov 30 deadline, if it should be granted to all home buyers (not just first-timers) and if the amount of the credit should be increased. What do you think?

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homebuyingharo’s answer
"All this gov't plans are ONLY benefit to the low income or no income. It is like penalizing the ones that who work hard for a living and struggle to live a better live."

Sean my husband and I are neither low income or no income. We are both college educated (I hold a Masters degree) and very hardworking. My husband works non-profit helping people (but unfortunately many times that equals low pay) and I work in higher education. Again helping people but not making a ton of money. We do OK. We have great credit scores and are careful with our money. We are first time home buyers. And while I think everyone should benefit from this $8K I don't think it is something that is "low income or no income" as you out it. As you say everyone is struggling in this economy. We like many other hard working educated people don't have a ton of money. We don't have rich parents that can lend us the money either. We have saved saved saved and still we would never have enough for a 10% down plus closing. This is why we need programs like FHA and the $8K refund. We are not high risk. We are just looking for a piece of the American dream like everyone else.
10 votes Thank Flag Link Thu Jul 30, 2009
The Federal Tax credit should be extended into 2010 and it should broaden the scope of its recipients to include more than just first time homebuyers. If funding cannot support $8000, then possibly a tiered fee structure helping those most in need and decreasing as it moves upward. The effects of the tax credit are just beginning to impact the lower and slowly the mid range market here in the Triangle. We need to keep this momentum moving.
5 votes Thank Flag Link Tue Aug 11, 2009
I think that the tax credit should be grant all home buyer the credit , even investors. This would end the home buying down swing and get the economy back on track
5 votes Thank Flag Link Thu Jul 30, 2009
I don't know if it should be extended, but if it does it should include a new income bracket to make many head of household types like myself eligible. I kind of think it discriminates against single parents. Tell me why a couple with no kids should be eligible but a single parent with kids should not when they make the same amount of money? The current income eligibility structure = 1950's mentality.
4 votes Thank Flag Link Tue Aug 18, 2009
I strongly feel that the tax credit should be extended at least until next June. There are alot of buyers who want to purchase but are still in the begining stages of saving downpayment money, correcting their credit profiles, and just recently really started listening to agents like myself about the tax credit. Another benefit of extending the tax credit would to be to assist those who are currently negotiating short sales which take forever it seems like to close.
4 votes Thank Flag Link Thu Jul 30, 2009
Yes, I think the $8000 tax credit should be extended and even extended to all buyers. That would surely boost the housing market which is key to getting this entire economy turned around.
4 votes Thank Flag Link Thu Jul 30, 2009
extended, I hope. Think of all the buyers involved with shortsales waiting on the banks to finalize everything. With that factor and the new laws regarding appraisals and such, closings are taking so long. It would be a shame to go under contract in August and close December 2nd and miss out.
4 votes Thank Flag Link Wed Jul 29, 2009
As a responsible agent, I fear for the added postponement of real recovery due to such artificial market forces such as free money. We already see sellers wanting to keep their prices higher than market offers because the buyer seeks the tax credit. What is the real market value of a home when this tax credit hangs out there?
3 votes Thank Flag Link Wed Sep 16, 2009
If everyone buying a home were eligible for the credit- now $8000 and some want more- and home sales are between 4-5 million per year, that is $32 billion dollars or more using lowest of the numbers, are you all crazy? There won't be enough money in the treasury for clunkers and everything else people want a break on. Sometimes these posts are so outlandish it is embarrasing. My solution is we have a massive bake sale, run by us realtors. Proceeds to go for anyone needing a hand to be a home owner beyond what they can afford themselves. If the bake sale isn't enough we give the Girl Scouts some competition on the cookies. Then, if needed, we can try the always popular Pancake Breakfast. And from my youth, the always successful "Chili Supper."
Oh, how about the credit does not require a home purchase? To go along with exended, for everyone- buyers and sellers, regardless of income level, to used to buy a clunker or any other vehicle, or anything else, at any time without penalty or refund. I think that covers all of us. Are you with me on this? Give me a thumbs up. Come on!
3 votes Thank Flag Link Sat Aug 22, 2009
Yes, it should not only be extended, but increased and opened up to all buyers. The home buyer tax credit increases home sales, which is what is desperately needed to eat up the excess inventory of homes on the market in order to stop home values from falling even further. Home prices have already fallen to pre-bubble levels, a correction is one thing, but any further declines would only hurt the economic outlook further, not only for all of us, but for the health of the banking system as well. The home is the assett that backs the loans, if home values continue to decline that only puts the banks in a worse position, then they can't make the loans necessary for small business's to continue to operate, which causes them to lay people off, unemployment rises. It's just a vicous cycle, dependent on once again a healthy housing market.
3 votes Thank Flag Link Thu Aug 13, 2009
I think this is a good incentive for first time home buyers only. These are a targeted group that with a little incentive can get the market moving, Keep in mind that the majority of time it's no where neer $8k it's 1% of the purchase price and the borrowers have to make less than a certain dollar amount to qualify. Investors and speculators are exempt. The buyers need to live in the home and it must be their primary residence. I think extending it for them is a good idea. I think all the other government bailout money should stop ASAP.

http://www.dawnsellssandiego.com/
3 votes Thank Flag Link Mon Aug 10, 2009
Absolutely, the $8000. tax credit should be extended. And, it should be possible to use these funds to cover closing costs as an alternative to a credit.
Loads of young people are looking to buy their first home and we should make this a possibility for as many people as possible.
Jo
Web Reference: http://www.JoGreenHomes.com
3 votes Thank Flag Link Thu Aug 6, 2009
I think it's a good thing to remember that the Government is 'giving' a tax credit for taxes that would otherwise be paid. That is why there is a rule that the owner has to live in the house a certain time. Depending on the house, the Government may be ahead but they aren't just taking money from us and giving it away. Since home owners have been paying taxes for years, I think that current owners should be eligible when selling and buying. It's not like the buyers are standing in line asking for something for nothing. People who purchase homes have already established themselves as credit worthy purchasers who have most likely contributed plenty of money to the tax base. Even the 'clunkers' Goverment deal is like that. Most of us have diligently paid our personal property tax on our vehicles for years. It's just amazing how the Government can tax us to death, use 90% of the money wastefully then make us feel thankful when WE actually get some of that money back! So, you have a new home buyer who is going to be given $8,000 when the buyer a house. Much of that is a credit for whey they would have paid and have paid in taxes already. When the get the money, hopefully they will put some or all of it away for a rainy day and/or pay off their bills but most likely, they will spend some of it. Since they qualify to purchase a home we can assume that they pay taxes already, have been contribuing to keep the economy going, have been responsible and (maybe most important) have and are working...not standing line line asking for a handout.
3 votes Thank Flag Link Tue Aug 4, 2009
Our local market has been saturated with first time home buyers without them we would have had a very slow spring and summer, this $8000 has helped our local market tremendously. One of my first time buyers bought a bank owned property that needed a lot of work , she bought all her essentials at Home Depot whom is offerineg a 12 month no payment no interest plan on credit. Her home now has all new hardwood floors throughout , new toilets, vanities, hot water heater and all new appliances and at the end of the year when she get's her $8000 she will pay off her credit card. Wow!!
3 votes Thank Flag Link Sat Aug 1, 2009
Agent Carl said:

"Again, if you need a house and can buy it, act now. Never postpone a home buying decision because you want to make money in a short time and therefore want to see the market bottom before buying."...

***
And Real Estate agents get offended when people refer to them as "USED HOUSE SALESMEN"... It's quotes like the above that earn agents the title "used house salesmen"...

There is NOTHING wrong with postponing a home purchase in the current economic climate... If i would have bought a condo in Los Angeles back in January this year.. I would have lost my down-payment already.. All the condos I have SAVED on Trulia have dropped $30-60K in the past 6 months.

What benefit would I have achieved by buying my home 6 months ago? In the meantime I have to live with the minor inconvenience of "renting" for 1/3 of the price it would have cost me to buy. Not only did i avoid losing my $30K downpayment in the short term.. But I managed to save thousands more in the meantime remaining a renter... It'll make sense for me to buy eventually... But not until homes in decent school districts come in line with incomes in the LOS ANGELES area.. That hasn't happened yet.
3 votes Thank Flag Link Fri Jul 31, 2009
Yes. I closed in Nov. 2008 and I didn't meet the income cap. I think it should apply to all first-time buyers regardless of income.
3 votes Thank Flag Link Thu Jul 30, 2009
YES! The housing market is no where near stabilized and this is actually one of the few "bailout" measures which has actually benefitted "Main Street" taxpayers... The "Wall Street" bailouts haven't done ANY good for 99.999% of Americans and have instead once again been political payoffs for all the Wall Street "geniuses" who got us into this mess with their "house of cards" mortgage back securities and other CATASTROPHIC investments.
3 votes Thank Flag Link Thu Jul 30, 2009
YES, I have been trying to buy a home since February. I have been out bid on 6 or more, I have over bid on a few (and still lost). In escrow once, just to have it fall out right before closing. Waited over one month for my EMD back. Now I am starting all over again. Found a house, in escrow again. Paid for FHA Apprials twice and inspections twice. Keeping my fingers crossed. But if this one falls out it will be starting over again. I am already out over $1500 and still don't own a home....The $8000 tax credit will help with the costs incurred already. Not It is not as easy buying a house in today market
3 votes Thank Flag Link Thu Jul 30, 2009
Yes it should be extended. I'm gonna be a 1st time buyer but I won't have things in proper order until February of next year most likely.
3 votes Thank Flag Link Thu Jul 30, 2009
YES! It should be extended to help the continuation of boosting the economy & should allpy to ALL home buyers, not just first time home buyers!
3 votes Thank Flag Link Thu Jul 30, 2009
Yes, It should be extended beyond Nov 30 deadline , Why?, cause i have a signed contract by the buyer on a short sale since 4/2009 and the lender has not provided an answer....i'm stock.
But only to first time home buyers giving the opportunity to own a piece of the American Dream.

JR
Palmetto Bay, FL.
3 votes Thank Flag Link Thu Jul 30, 2009
Not only should it be extended, but it should also apply to excisting homeowners. The market will surge with buyers.
3 votes Thank Flag Link Thu Jul 30, 2009
Yes, it should be extended beyond November 30th, but ONLY to first time home buyers. I see alot of folks in pain in this economy and I am no different. I'm getting very bitter about it too! I have a Master's Degree and 3 certifications and still can't find a job. My husband filed for divorce, my son is headed to college and I don't have a dime - I believe things will get better but I need more time to take advantage of this awesome Presidential offering. Folks that are lucky enough to keep their jobs and already have a home already have a leg-up on me! So ABSOLUTELY NOT, they should not be included in this benefit. They are doing well, good for them, the rest of us need an opportunity to equal this playing field!
3 votes Thank Flag Link Thu Jul 30, 2009
Yes !

I am currently pre-approved and I'm afraid with alot of homes in short sale means long waits waiting for bank approval. The tax credit should be extended to all first time homebuyers and other homebuyers. I pray it will happen somehow.
3 votes Thank Flag Link Thu Jul 30, 2009
yes yes yes yes yes yes yes yes yes
3 votes Thank Flag Link Thu Jul 30, 2009
YES, DEFINALLY THEY SHOULD EXTENDED, SPECIALLY THAT THEY ARE FIRST TIME, IT IS A GREAT HELP TO OWN. THEY ARE STILL COUPLES THAT NEEDED A LITTLE MORE TIME.

NELLA DOSKIS
REMAX CENTRAL
BROKER-ASSOCIATE
3 votes Thank Flag Link Thu Jul 30, 2009
Absolutely! The housing market can use any boost that is available.
There are MANY buyers in todays market that could really use the tax credit to help get reimbursed for closing costs they had to pay and to complete upgrades to improve the home they purchased.
I also think the goverment should go back and allow the first time home buyers that purchased their homes in 2008 to not have to pay back the tax credit like the first time home buyers this year.
3 votes Thank Flag Link Thu Jul 30, 2009
Yes, I do believe the tax credit should be extended beyond the Nov. 30 deadline.
3 votes Thank Flag Link Thu Jul 30, 2009
The credit should absolutely be extended....yes, short sales are taking a long time to close and we are finally seeing some very small signs of improvement in housing sales the end of the credit would cut us all off at the neck!
3 votes Thank Flag Link Thu Jul 30, 2009
From our vantage point there is plenty of information to support the extention of the existing program's deadline or the implementation of a program the will find it way to the people that would benefit the most.

Our feeling about the situation that presently exists it that when this program ends there will be many people that will have missed the boat because the were tied up in multiple offer "short sale" delema finding themselves waiting for months for a specific property, only to miss out on the home and the Federal tax credit.

Good luck
3 votes Thank Flag Link Wed Jul 29, 2009
Carl. once again I agree but, the majority of Realtors will disagree. It is not a tax credit we need, it is jobs that produce income that will pay a mortgage for the long term! The tax credit will only defer the inevitable and only a very short term fix. If we all agree that loans and prices got out of hand then why do we want to continue on a path that leads to more problems. I was told a long time ago : One only learns by what it costs them- a very true statement. Yes, real estate sales could worsen without the tax credit being extended though are we promoting the extension on our own behalf? If so, we realtors are no better than the folks who sold the bogus loans. If we really want change in politics and regulation that provides our industry with stabilization we must accept the potential pain to obtain our goal !
2 votes Thank Flag Link Fri Oct 23, 2009
The problem with any credit or gimmick to buy a home is -Who is really paying the price? If it is extended it becomes expected and eventually will be added to the price of a home and financed. If our present problem originated from too high of home prices in relationship to income-then we are only deferring the inevitable as with the bank bailouts. Would you invest in stock that has an extremely high PE ratio- I think not. The sooner we return to a real world in terms of finances. The sooner we will see stabilization in the housing market-without tax credits. Where is the true bottom of home prices- value is in the eyes of the beholder- meaning: the one paying for it. A loan of thirty years is a Long Time! Buyers need to realize that alot of things can happen in thirty years to derail the payment of the loan. The sooner we realtors understand that a short term fix is not the answer for longevity the better off we will all be. Real estate sales used to be based on long term relationships to make a living not quick commissions.to get rich! The tax credit is not answer to our problem.
2 votes Thank Flag Link Wed Sep 30, 2009
This month, I did a poll to CA Bay Area buyers on the first time home buyer tax credits and whether or not they were a motivating factor in their purchase. Out of 45 Reponses, I had the following:
* 67% are motivated to buy by the tax credits offered
* 62.5% feel the pressure to buy right now
* 16% will actually stop searching for a home if they don’t get the tax credits. Shocking!
Yes, I feel the tax credits should be extended, but on a *scaled back* version, as it continues to spur the entry level real estate market in the Bay Area and is a driving force in jump starting the Bay Area market. I would like to see a more normalized market where buyers don’t feel threatened with a deadline to buy or not buy. No, I don’t think it should be increased or extended out to non first-time home buyers.
Per one respondent, “It's nice to have the 1st time tax credit as an incentive but it can also add unnecessary pressure to buy for a lot of people who, again, maybe shouldn't. Isn't that partly how we got into this mess?”
2 votes Thank Flag Link Fri Sep 18, 2009
Yes, absolutely. First-time buyers are feeling the crunch and stress to purchase a home. Many have money set aside for their down payment, but are having a difficult time getting their offer accepted due to the competition. It isn't their fault that they can't find a home, there just is not enough quality inventory to support the demand. My clients are up to their 15th offer and are up against all-cash buyers and buyers who are willing to go higher than their limit. I have other clients who are almost ready to go, but now are feeling frustrated because they are going to be left behind and not be able to get the credit they will need to maybe fix up the home once in it. The clients that have been able to purchase a home and get the credit are really grateful for it. They have been able to do the fixes that the previous owner could not or would not do. It also allowed they to "drain" their savings to purchase their home and know they would still have money coming back that would give them a little cushion. This is the best economic stimulator we could possibly have. When a home is purchased, MANY people get paid, not just the realtors and brokers. Companies like Home Depot, Bed, Bath & Beyond, Sears, Lowes, Best Buy, furniture companies, etc, all benefit.
2 votes Thank Flag Link Tue Sep 15, 2009
I thought the original reason behind the credit was that their was a growing inventory of vacant foreclosed homes that were driving down the value of surrounding homes creating a cascade effect of decline on neighbors who may not have been irresponsible in paying their mortgage. The government couldn't buy and maintain all the empty homes when the failing banks couldn't. The cheaper solution was to add new first time buyers who had been unable to afford a home during the boom years. Extending the credit to all is far too expensive and pointless as it's just a house swap adding no one new. The effect will be the opposite and sellers up their prices artificially across the board to soak the credit money once again shutting out first time buyers.

I'm somewhat bias like most here. In my case, I bought a modest home for the credit and because I've got a kid on the way. Due to market changes I don't expect to make a profit when the real price of the home isn't what we paid but the total for a 15 year mortgage. I rarely hear buyers or sellers say that so I'm assuming they base the value of their home on original price paid+improvements+/-comp values.
2 votes Thank Flag Link Mon Aug 24, 2009
This tax credit might honestly be the biggest blunder ever! I was amazed to find that since people are using it for their down payment, the mortgage companies are using it to qualify them for a home they otherwise can't afford! I though we were trying to get out of this crisis, not go further into it! Comments?
2 votes Thank Flag Link Sat Aug 22, 2009
I think it should be extended to all first time home buyers and not be phased out at an income level as geographically this does not make sense for all markets. Clearly there is a huge price differential as well as salary differential in certain markets including the greater Boston, New York (Long Island), and many other parts for the country etc where the salary to be able to buy a first time home does not coincide. For example, in a community where a starter home for a first time buyer is close to $500K the salaries clearly need to be beyond the max salary level to be eligible for the tax benefit however these first time home buyers are just as impacted by the recession and should be able to have some start up relief.
2 votes Thank Flag Link Wed Aug 19, 2009
In general sellers should be careful about trying to negotiate the $8k away from the buyer. I just had a seller, in a multiple offer situation, demand that the buyer agree to pay any difference in selling price and appraisal in cash, with no limit on the amount of difference. That buyer walked away. All risk and no reward.
I beleive most buyers eligible for the 8k credit are not likely to negotiate it away to the seller. At a point, the incentive created by the credit disappears when the seller demands too high a price. The buyer will walk away when the incentive is removed by the seller in negotiaions.
2 votes Thank Flag Link Mon Aug 17, 2009
Yes. Absolutely. An Extension is needed. Many buyers are just now getting educated abut it and it is less than 4 months remaining. With 60 day closings, there is less than 2 months to find the house and get under contract. In most cases, buying a short sale or a foreclosure will take longer than 2 months to get under contract. Those are the homes that really need to get out of the inventory. Also they are very often in the first time buyers price range. There does not seem to be any reporting as to how many homes are being sold already that qualify for the credit, so I am getting the impression that the number is low. It's just not as simple a purchase as turning in a 'clunker' and driving away with a car.
Web Reference: http://www.GWalsh.com
2 votes Thank Flag Link Mon Aug 10, 2009
I think Josh's sarcasim was missed. I don't agree with throwing free money around simply because it's not free. It's the tax payers money. Also, I don't see the home buyers tax credit as a hand out. It's a tax credit that buyers are getting on all or a portion of taxes they will be paying over the next few years. Far more people are receiving sec 8 and other housing subsidies that have barely contributed to the tax base vs the home buyers that, merely by qualifying for a loan, have likely proven to have jobs and a credit history that has contributed. The 8K spent now that helps someone purchase a home is going to result in a long run of tax revenue via property taxes that will not take long to pay for itself.
2 votes Thank Flag Link Fri Aug 7, 2009
I'm shocked on how many agents say the free money should keep on coming so they can make sales. How about "the $8000 can be used to buy a clunker?" It's just a tweek of the program in place. Sellers to get the $8000 so they can buy something else whether they need it or not? How would this work for sellers? They take less for their house because they are getting $8000 from IRS? And the buyer gets $8000 so the price is propped up above the real market value? So what is the house really worth? Should that house be marked in the record as an anomaly so future comps do not artificially miss read the number? The seller's just deserve that $8000, is the answer I guess. Multiple home owners to get the $8000 if they buy another one? Higher income levels eligible? Why not? $8000 is not really very much. How about $15,000? The more you spend the larger the credit. How about that? Pass the Koolaid please. BTW, I have a buyer looking for about 3 months for the perfect house tell me they are worried about changes at his employer so they are postponing their search. Do I repeat the "now is great time to buy" mantra, remind them of the $8000 credit, prices may start up at any time and such? Or should I be honest and helpful as well as a real professional and tell them they are doing the right thing because they must be comfortable and motivated as buyers? I'm so confused. Professional or greedy and unthinking? What to do.
2 votes Thank Flag Link Fri Aug 7, 2009
From what 'I've been read, it's in the works and I see many of the provisions u mention being passed by Congress.
2 votes Thank Flag Link Thu Aug 6, 2009
... I say this as I'm sipping this fine tasting red Koolaid that smells a bit fermented and miasmatic like the rest of the agents here... "let's bump this thing up for another 5 years and make an additional $8,000 Seller credit, $8,000 Realtor credit, $8,000 Lender Credit and a $8,000 Escrow Credit"..... yep.. that will do it!
Web Reference: http://www.eXposedHomes.com
2 votes Thank Flag Link Thu Aug 6, 2009
The government needs to quit handing money out and start giving it to the people that need it. The hard working, tax paying citizens and quit giving it to congress and their aids. So the answer is yes! It should be extended for at least one more year and it should be offered to anyone that buys a home or possibly split the credit between the buyer and seller. That would motivate both buyers and sellers.
2 votes Thank Flag Link Thu Aug 6, 2009
Yes on extending and also increase the income cap, especially for people that want to buy in San Francisco. People that do qualify for the credit, I cannot imagine can afford a home in SF, with prices for 2bedrooms at 650k +.
2 votes Thank Flag Link Wed Aug 5, 2009
The $8,000 federal tax credit probably will be increased past November 30th. But you have to give people a deadline to purchase or they would drag their feet. It is having a positive affect on the market and the economy and we will pay for it down the line with increased taxes so why not.
2 votes Thank Flag Link Mon Aug 3, 2009
This has been beneficial in stimulating our market here in the Akron, Ohio area and would like to see it extended as it appears to be one program that really is working.
2 votes Thank Flag Link Mon Aug 3, 2009
Yes, if it will help stimulate sales
2 votes Thank Flag Link Mon Aug 3, 2009
Yes. I hope it will have a better explanation on how it works so buyers are more prepared at purchase time. Also, a First Time home buyer course will be nice.
2 votes Thank Flag Link Mon Aug 3, 2009
Forget the politics, there's a new wave of bank owned properties about to hit the market and without first time buyers, the market will revert to investors. This will mean lower prices and fewer sales. First time buyers are buying seller occupied homes as well. These sellers are usually buying up and this is a much needed benefit of the tax credit......keep it rolling!
2 votes Thank Flag Link Sun Aug 2, 2009
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