Michael Nevi…, Real Estate Pro in Atlanta, GA

What are your thoughts on the Homebuyer Tax Credit?

Asked by Michael Neville, Atlanta, GA Fri Feb 20, 2009

- Applying to 1st time homebuyers only? (and the purchaser's spouse - meaning neither could own a principal property in the last 3 years)
- Full amount of credit to individuals with adjusted gross income of no more than 75K (150K on joint return) with phase out caps of (90k & 170K)
-No repayment for purchases Jan.1, 2009 - Dec. 1, 2009

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Answers

7
I think Jackie has a great perspective on this matter.

I also highly suggest that if you don't know "The Phoenix Real Estate Guy," then you should.

He makes all of us look like freshmen and if you click on the web reference and go to the easy to understand Tax Credit graphic that is downloadable to PDF, if you click on the web reference and go to the self-proclaimed "The Best Damn Real estate Blog on the Planet," then you'll see why.
0 votes Thank Flag Link Sat Feb 21, 2009
Jack, under the OLD stimulus package you had to buy a home by July 1 2009. That is no longer around.
0 votes Thank Flag Link Sat Feb 21, 2009
The tax credit of $8,000 for first time home buyers is a start. I do not feel this is enough. Let's open the credit to all home buyers who are buying a home. I don't know that the investor should be in the equation, but, then again, they would be eliminating our inventory. Consider giving a home seller a tax credit.....why not? They are loosing money on their homes. Additional though should be given to reduce the interest rate to 4% fixed for 30 years to really jump start the housing market. The credit is a start but we need more help for the middle buyer/seller.
0 votes Thank Flag Link Sat Feb 21, 2009
Hmm. I thought one had to close on a home by August 31, 2009 to qualify for the credit?
0 votes Thank Flag Link Fri Feb 20, 2009
I have a couple of first time buyers taking advantage of this incentive. It's a great opportunity for a first time buyer to purchase a HUD home or other foreclosure and have a fund to make repairs or update the property.

My current clients intend to use their tax credit money toward the purchase of a new car. It would be a great boost to the economy if the auto industry could partner with the housing industry to create a multi-tier incentive to take advantage of this tax credit.
0 votes Thank Flag Link Fri Feb 20, 2009
Michael,

Let's face it., to a large degree, first time home buyers are already buying. They are taking advantage of the deflated pricing and the fantastic interest rates, and are jumping on the opportunity to stop paying someone else's (their landlord's) mortgage. Sure, this tax credit will be a nice way to add an even more compelling reason to get off the fence, but it's really just icing on the cake.

In my opinion, the place where it would have the largest impact would be with the middle market sellers who are having to take a hit on the sell of their home to make their way into another. It may give many of them an opportunity to be more competitve with the inevitable foreclosure down the street, knowing that they would have a little tax relief in their futures.

I guess it's obvious that I share Lisa's hopes that additional legislation would allow more home buyers to participate in the tax incentives. (Supposedly, Isakson is attempting to revive his version as a standalone bill.) Certainly, most homeowners receive tax incentives already by being able to claim deductions for interest from their mortgages. Even so, if the objective was to actually STIMULATE a recovery, I think that extending the tax incentive to the middle market would have a much broader impact.

Great topic!
0 votes Thank Flag Link Fri Feb 20, 2009
I'm hoping that additional legislation will be enacted to include more home buyers. If we could get a tax credit for anyone purchasing a primary residence (subject to income limits) I think it would have a significantly large impact on the economy.
0 votes Thank Flag Link Fri Feb 20, 2009
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