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Senate Approves $15,000 Home Purchase Tax Credit

Currently, there's a $7500 tax credit for home purchases, but the credit must be repaid over the period of the loan. If the Senate measure becomes law, it would provide 10% credit, up to $15,000. Industry professionals back the measure as a means to spur the housing market.

The following is an excerpt from: http://tinyurl.com/ahy9rk

"Anyone who buys a home within a year of the bill's signature would qualify. And, consumers would be allowed to spread out the credit over two years. To deter speculators, buyers must occupy the house as their main residence for at least two years.

But the tax incentive is likely to be more helpful to buyers in less expensive markets, said Christopher Thornberg, a principal with Beacon Economics in Los Angeles. "Unfortunately, in the places that are most hard-hit, like California, it's going to have less of an impact," he said.

A tax break passed last summer provides a $7,500 credit to first-time homebuyers. But that must be repaid over 15 years, and the impact on home sales has been negligible.

Buyers will still face tight lending standards, and mortgage rates have climbed since hitting a record low of 4.96 percent last month. The average rate on a 30-year fixed mortgage rose to 5.25 percent this week from 5.1 percent last week, mortgage finance company Freddie Mac said Thursday."

Associated Press Writers Daniel Wagner and David Espo in Washington, and Alex Veiga in Los Angeles contributed to this report.

Copyright © 2009 The Associated Press. All rights reserved.

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Marianne Snygg, GRI, ABR, ASP
Broker Associate
ERA Herman Group Real Estate

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Colorado Springs and Monument Real Estate

Comment balloon 3 commentsMarianne Snygg • February 06 2009 01:16PM

Comments

Marianne,

I hope they do something~something is better than nothing~Home values in my market have dropped substantially the past year, so we are seeing a lot of buying going on.  However, to have transactions close~you have to work twice as hard for your customers.

I would like to see lenders begin ease on their lending criteria, I believe this will help our economy rejuvinate itself.

 

Posted by Laura Higgins (ERA Advantage Realty) over 10 years ago

As far as the Lending Criteria...

Wasn't some of the umpteen billion bail-out dollars supposed to end up at some closing tables once in awhile?

And we are giving (or making) more?

 

Tim

Posted by Tim Spargo, Certified Master Inspector, Inspected Rite (Spec Rite Inspections - Lancaster Palmdale CA Inspector) over 10 years ago

Laura: I couldn't agree with you more! It began with the housing market, recovery should start with the housing market, too.

Tim: Thanks for stopping by. I see you are in Colorado Springs. I hope we run into each other soon.

All real estate is local! That being said, I think CS is going to have a great year. We have been seeing Open Houses attended well, and what follows are sold homes! Yeah.

Posted by Marianne Snygg, ABR, ASP, GRI, SFR (ERA Herman Group Real Estate) over 10 years ago

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