OK so let me pose the question. Can you be for fiscal responsibility AND for extension of the real estate tax credit ? Here is the debate. Many are looking at Government spending and saying, "wow we are out of control." If you buy that argument or are even concerned then how can you be for an extension of the tax credit?
Yes I know ther tax credit has helped. We have benefited from it here. But in almost every program somebody benefits. When a program is cut somebody loses. So are you saying, "cut , but not in my back yard?"
I pose this question because sometimes we are so quick to raise our voices against government spending EXCEPT when it effects us. So now that I have posed the question I think I should get off the fence and give my opinion.
I think we should adopt the Senator from Georgia, Johnny Isaksons plan. He calls for 15,000 home buying credit for a primary residence. No other strings. This is a plan, with a reduced number, he was part of during the S&L problem a while back and it worked. I think Congress should say it will sunset after one year period. As painful as it may be we need a control on spending. Even if that spending some times works for us.
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Charlie Ragonesi All Mountain Realty Big Canoe and Mountain Blog
On line at www.allmountainrealty.com Call at 706 579 1098
Charlie - while conflicted about it, I am against continuance of any credit, except for military serving overseas during the credit eligibility period. I would make $8000 for those in non-combat and $15,000 for those serving in combat zones. I would also make them eligible for cash for clunkers.
I think we would be better off stimulating real jobs so that there can be real income. Anything else would be an artificial recovery.
Charlie...
The problem is that a universal credit will instantly devalue all homes by $15,000 when the credit expires. I don't like i, and I don't think that we need it for a full long-term recovery!
Charlie,
The $8k first time buyer credit has worked well clearing low end inventory in Florida but has done nothing as you go up the food chain price wise. But another tax credit like you describe won't help sellers that are heavily leveraged often owing far more than their homes are worth effectively making them prisoners unable to sell even if willing buyers are there. The staggering depreciation of home values is a monster not easily tamed. The middle and high end of the residential real estate market has tapped home equity lines to a far greater extent than the low end of the market and thus carries far more potential risk to the future national economy than the sub-prime market supposedly caused. Additionally, commercial real estate is on the verge of a free fall collapse so expect legislation to address the problems of the formerly wealthy investor class to get some grease. I don't know if there is a good answer to any of it but we'll get through it, Americans usually find a way when the chips are down, lets hope for the best but be prepared for more blood letting.
Isaksons' proposal makes sense WITH end in 12 months so that the current home inventory is absorbed quickly and put back on the local tax roles.....
I think that the program should be extended and widened to include any home buyer ~ not just first time buyers. The program would have been better if it had been offered as a down payment assistance plan instead of a tax credit.
Charlie --- this is such a large debate --- I go back and forth on it.
Mama Liz
I agree with Sandy, it should have been down payment assistance instead of a tax credit. We would be way ahead by now. I also want to control spending but let's stop the waste. I don't feel that helping people buy homes is a waste but is something that will in the long run actually make more money than is spent implementing the program. Look at the differeence in a family that owns their home vs one that does not. The economic benefits to our country are huge.
The best thing about the $8,000 credit was that it put some of the money into the hands of real people, not financial institutions.
In my opinion, we can not afford to continue the program as it is. We will have to come up with another program if the momentum caused by the $8,000 credit fails to continue.
If the market continues to improve interest rates will rise. Those who did not jump on the "purchase a home in 2009" wagon, may have missed the boat.
Just say no. We need to stop the current credit when it ends, and we need to let the market run. All we are doing is cannibalizing future sales. At some point it will catch up to us. I think that time is now.
I'm trying to think of a way to "stabilize" the market that doesn't screw it up... I haven't come up with one yet.
Hi Charlie:
I'm for the credit expiring on 11/30.
Buyers are expecting it to be extended and not going forward with any urgency...
BUT, I'm also in favor of a new credit for next year, of a lesser value.
This way, for people who missed out, they have a second chance but it did cost them for delaying their decision...
Charlie,
I think the tax credit has been good for the economy and the housing industry, much better in fact than the bailouts of the financial institutions.
I have buyers who bought and are going to renovate their new homes for added value when they resell in a few years. But even if they had simply saved the money, it would still be good for the economy. Now if they are buying all made in China goods.....that is another story.
Ann Hayden in chilly Wildwood, MO
Should everyone get a $15,000 tax credit for buying a home? Every Realtor could find some justification for voting for it, as it would put much more money in his or her pocketbooks.
And lets remember, the vast majority of people vote first for what is good for their pocketbooks; Realtors included.
But be prepared, at the rate we are going, our grandchildren "won't" have to pay for the ever-inceasing national debt, the bill is coming due very very soon in every community in America. The national debt is a bubble, and we all know what happens to bubbles.
Jeb - There are a lot of us in the industry that aren't in favor of extending or increasing any tax credits... even though it may have a negative short term affect on our incomes...