How About a $15,000 Tax Credit For All Buyers, Even Millionaires

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  1

  jfree85

  06/11/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  this sounds amazing! i hope legislators act quickly on this and get the help to the people who need it before it's too late

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  2

  ja1515

  06/11/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  do you think this is just a political stunt? or do you think it
  could actually get through any time soon?

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  3

  tappp

  06/11/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  The problem, though, is the investor hounds are already back. As an example, in Vegas, there are investors purchasing 50 to 100 homes in a small time-frame looking to make a tidy 10k, or more, profit forcing the rest of us into the black hole of mortgage stress. I have placed several bids on homes only to have investors sweep them away and my offers are at the $75 to $85 per square foot range. Standard homes are simply not worth that.

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  4

  lwoody

  06/11/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I think this bill has a lot of potential to really stimulate the
  economy. We need some "grassroots" movement on this bill.

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  5

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  From Todd:
  
  Have you ever considered the paradox of buyer behavior in seller's and buyer's market? In a hot seller's market, buyers throw money at houses, worried they'll miss out (i.e. buy high), therefore bidding up the prices. Then in a buyer's market in which fear rules, buyers sit on the sidelines as prices drop, waiting for a "steal of a deal", vainly timing the market because they're afraid they'll pay too much.
  
  This $15,000 hand-out would help push off the fence sitters with some "house money". Additionally, the recent up-tick in mortgage rates (although MBS had a great day yesterday) might also serve as a nudge.
  
  However, as studies have shown and as I'm sure you know, buyers will wait until after a market shift and prices begin to increase before they jump en masse. They'll wait for the media to tell them when!
  
  The problem with the prospect of a 15k credit is the fed seems tapped out. Rates are moving higher because they can't keep pace buying MBS on the one hand while also pumping the market full of treasuries to fund all stimulus on the other. But as Mamma always said, "It's better than nothing."
  
  Be well.

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  6

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @Todd:
  
  The idea of a bunch of lemings going off a cliff is an apt metaphor for some of what has been going on over the past 3 years in the housing market. The idea that you can "fix and flip" a house and make a fortune has driven millions of Americans into making less than savvy choices for themselves. And, there were plenty of folks ready to help them make those poor choices, and pad their own pockets from them.
  
  As for the Fed being tapped out, I don't know about that. Bernanke seems to have a few tricks left. I'd like to see how he's going to drive long-term interest rates back down. What's happening now just makes my own 5/1 ARM look a lot better: I'm paying 3.35% for the next year on my loan, saving me $6,000. Next year, I'll probably pay a similar amount. You can't do much better than that, which means there is zero incentive for refinancing.
  
  I'm not in the market to buy property, but I do agree that with an extra $15,000 for a buyer of real estate (who earns no matter what), there are plenty of great deals out there. I just wonder if we're setting ourselves up for another fast bubble.
  
  The simple truth is not everyone should be a homeowner. And, not everyone should be a landlord. Even if you'll make buckets of money doing it.
  
  I appreciate your thoughtful response. Thanks for the comment.

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  7

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @Lwoody:
  
  The Realtors, Home Builders, and Mortgage Bankers have always thought that handing over $15,000 to a home buyer if they purchased real estate would be a good way to get things moving. No doubt.
  
  The question is about sustainability. How long can you keep priming the market encouraging people to buy and hold property? If you create a false market by over-stimulating sales, you'l wind up with properties selling for far more than they are worth.
  
  What about the long-term? Say this legislation goes through and now people get $15,000 to buy a home through next year. Anyone can do it. What happens when that ends? Who will eventually buy or rent these homes? Can we sustain the growth over the long run or are we just postponing the inevitable?
  
  Instead of making buyers angry that they bought last year and got a $7,500 credit they have to repay, or frustrating buyers who bought this year and will only get an $8,000 credit they don't have to repay, wouldn't it have been better to choose the larger number to begin with and open the window for a short burst of home buying energy?
  
  I'm not saying we shouldn't do it. I just wonder what happens to the real estate market when the stimulus ends.
  
  Thanks for your comment.

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  8

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @tappp
  
  Part of the reason we're where we are is people were paying too much for homes that weren't worth it. I have been hearing about the feeding frenzy in Phoenix, Las Vegas, and parts of California. I can't believe this is sustainable, but there are so many people who believe in this fix-and-flip mentality. What I'm hearing now is that people are just swooping in, bidding up the prices of these homes, and then flipping there. And, they're not just buying 100 houses at a time - they also buying 1000s.
  
  Is this helping the economy?

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  9

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @JA1515
  
  Political stunt? Sure. This legislation has been proposed before. But while there are some "green shoots" for the housing industry, and sales are picking up somewhat, we're nowhere near a normal market.
  
  One problem is that Americans are addicted to the quick fix. What this economy needs is time so we can really see where we are.
  
  Thanks for your comment

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  10

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @Jfree85:
  
  If the $15,000 tax credit passes, will you go and buy a house? How much can you spend?
  
  Thanks for your comment.

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  11

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  From @Todd:
  
  What will keep things in check from another bubble are tighter lending (and new regs/oversight), unemployment (or fear of) and real income not keeping pace with inflation. And I think the market taught a cruel lesson to the so-called "investors" who now know the difference between POSITIVE cash flow and speculating (gambling) about appreciation.

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  12

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I'm not sure I agree that the lesson about positive cash flow has been learned. Check out some of the other comments on this blog. I think there are plenty of investors who are buying and flipping within a couple of days, hoping to make $10,000 each on 100 house purchases. It's a tidy sum if you can get the work - and apparently there's plenty of it out there.
  
  In some areas, like Phoenix, Las Vegas and even parts of Atlanta, the feeding frenzy has begun.
  
  But I'd love to hear what's going on in other neighborhoods.

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  13

  linsang1998

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Why stop at 15k, let's increase it 5k a month (and of course make it retroactive for anyone unfortunate enough to have bought to soon), until we hit the desired sales and price level (as determined by the homebuilders, realtors and mortgage bankers). However, we need to be careful not to leave the buyer without the ability to furnish the house, upgrade appliances, add some landscaping- perhaps an add on tax credit of 5% of the home value (this will discourage people from bidding low and encourage people to buy higher priced homes) for these items.
  
  If the additional federal deficit causes rates to rise and threaten the reignition of the real estate market (higher rates reducing affordability), not to worry. Simply set the interest rate on the loan so that it will cap the total debt to income ratio at 30% (this will also allow the consumer to load up on debt and have it subsidized through their home loan), the difference between required rate and the prevailing rate in the secondary market can be paid for by the Fed (the "subsidized homeowners interest tender").
  
  While this is a good start, it still leaves a couple of items yet to be answered:
  
  If the downpayment required exceeds the tax credit, how will that be made up (non-interest bearing 2nd)? Today's homebuyers should not be expected to have equity in a property that could potentially be lost. Furthermore, savings used for a down payment, could limit spending in other areas and thus detrimental to other struggling markets (see below).
  
  Will this structure be enough to get the automobile industry back on it's feet? Granted, capping the interest based on total debt to income may help to subsidize a car payment, but it may not be enough.
  
  We need to be sure that other industries hurt in this recession (travel, cosmetic surgery, Spa's, etc) aren't negatively impacted by having consummers dedicate to much of their income to their housing expense.
  
  Finally, some relief needs to be afforded the realtors, mortgage bankers and mortgage brokers who have suffered through a couple of tough years. Perhaps a carry back or carry forward of their lowest effective tax rate for the last three years- file an amended return applying the lower rate against taxable income in prior periods and have the difference refunded.
  
  As to funding for all this- ink and paper are still relatively cheap. Is there any wonder why Chinese students laughed at Geithner when he proposed our deficits would not be a problem.
  
  
  
  

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  14

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Another post fro @Todd:
  
  I live in a wealthy area, Charlottesille, VA (home of UVA). I know there are some money people taking advantage of REOs, paying cash for fast flips. I'm also aware of some syndicates. But the investors I'm aware of are buying out of market in retirement destinations like Hilton Head and any number of places in FL.
  
  Regardless, the strict definition of "investment" is "returns a dividend or produces income" and then its return must be justified by the use of money, with or without leverage (positive vs negative leverage). Anything else in my book is gambling no matter what anyone wants to call it.
  
  I'm a former Realtor and lender. Still keep tabs on all of it just as an interest. Our next door neighbors moved here from Vegas. At one point their home appraised for 1.26 million, after sitting on the market for a year, just sold last winter for $660,000! Luckily for them they actually netted on the sale.

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  15

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @Julia:
  
  A great idea, providing the interest rates do not sky rocket.

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  16

  be-real

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  As beautiful as this may sound, it is more government involvement and added tax code complexity.
  
  "When the people find they can vote themselves money; that will herald the end of the republic."
  
  Benjamin Franklin

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  17

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @be-real:
  
  The only thing I've come to realize is that there is no free lunch out there. And, there's no free money - at least, there isn't free money for everyone.
  
  The $8,000 gimme for first-time buyers targeted a specific part of the population. The problem is, higher interest rates (even a point higher) will eat away at that benefit, virtually wiping it out in some cases.
  
  You might say, well, those people would have paid a higher interest rate anyway. That's true, but having super-low interest rates helps make a lot of things more palatable in what is still a down-and-out-economy.
  
  If you gve $15,000 to anyone who buys anything, no matter how much money they earn, whether it is a personal residence or investment property, the risk is that you begin to create another housing bubble.
  
  Read some of the other comments here and on my own website, ThinkGlink.com. It's clear to me that in Phoenix, Las Vegas, parts of South Florida and Southern California, mini-bubbles are forming, spurred by investors who are scooping up 100 properties at a time and flipping them for $10,000 to $25,000 in instant profits.
  
  That's how the bubble started not a half dozen years ago.
  
  The hard question we need to ask ourselves is this: Do we want to be a bubble economy? Or, do we want to be a long-term investment economy?
  
  @be-real: Thanks for your comment. Anytime someone adds some Ben Franklin to the mix, it's a good day.

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  18

  Ilyce Glink

  06/12/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @linsang1998:
  
  You make some interesting points. I'd like to have been in the room (and fluent in Chinese) to hear what those students were saying behind (or in front of) Geithner's back.
  
  We're in uncharted territory, with just 10 lost years of Japan to guide us and a fear of returning to the kind of thinking and bad financial mistakes that pitched us off the cliff last September.
  
  Right now, I'm with the camp that think all this so-called "good news" isn't really based on anything that tangible. See my new post on the subject.
  
  Thanks for your thoughtful email.

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  19

  Ilyce Glink

  06/15/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @Todd:
  
  Your friends from Las Vegas ARE lucky they wound up not owing thousands on the sale of their home. I guess the 50 percent reduction in home valuations has also hit Las Vegas, and not just Phoenix.
  
  I agree with your assessment of gambling. I am starting to hear more stories (anecdotes) about people who are scooping up dozense of properties at a time, buying directly from the banks, and then turning around and reselling at higher prices to consumers.
  
  It's unsustainable, and I believe it's the way our problems began back in the early 2000s.
  
  Thanks for your continued comments.

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  20

  @angela

  06/23/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Yes much stimulus good can come of this, but limits on home prices (say under $300,000)and terms of "live in only" rules MUST be applied . These are simple and easy ways to avoid another bubble and to keep FLIPPERS out of the deal. It should be for ordinary Americans looking to upgrade, but to afraid to do so unless some incentive is provided to us.

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  21

  Ilyce Glink

  06/23/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @angela:
  
  I'm not sure whether Sen. Isakson's proposal is for owner-occupied property or whether it is also designed for investors. Real estate investors appear to be looking for a hand-out as well, as many bought property at the high point in 2005-2007 and are now suffering as the properties have fallen dramatically in value and rental rates have dropped as well.
  
  Limiting the stimulus to homes priced under a certain point (you mentioned $300,000, but I think the tax credit is structured at 10 percent up to $150,000, or $15,000) is interesting. I haven't heard anyone suggest that yet.
  
  Would you buy a house if the federal government gave you a $15,000 tax credit?
  
  Thanks for your comments.

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  22

  jeannie12

  07/03/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  The point made that increasing the tax credit to all home buyers to $15K would result in house prices increasing is not feasible. Don't forget that the house will be appraised based on the current housing market regardless of the tax incentives. If a property's home value is appraised at $150K and the seller tries to sell the property for 165K because of the 15K tax credit, the house will still only appraise out for the buyer at 150K. Unless the buyer was able to put 20% down (which limits the buyer pool as most buyers don't have 20% for a down payment in this economy), the buyer will not get a loan for more than the house is worth.
  
  Let's also not forget that current homeowners have lost substantial value in their homes over the past 5 years.
  Ten years ago homes in my neighborhood sold for $170K to $200K and now are selling for $125K to $150K. If we realize a slight increase in the value of our homes due to this credit it wouldn't be a negative result.
  
  I'm certain that houses were valued higher than what was reasonable, however, the real culprit in the demise of the housing market was easy access to mortages by lenders with low standards for borrowers. When I purchased my home in 1987, you had to have almost perfect credit, verification of income, tax returns, savings, etc. Let's not forget that lenders were handing out mortgages to buyers without proof of income. Shame on them and because of that I've lost $30K in my home value. As a home owner who bought a home that I could afford and have made my mortgage payments without fail over the past 22 years, I like many others deserve a break which a $15K tax credit could provide. The irresponsible buyers are walking away with no penalty and the lenders are getting billions of $$ from the Feds, and the average responsible home owner is getting screwed.
  
  Bottom line the real estate market is in shambles and reasonable incentives to get the market moving makes sense.
  I'm sure somewhere in the almost trillion dollar stimulus package the feds could cough up the $15K for potential home buyers.
  
  JH
  Oregon, OH
  
  

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  23

  Ilyce Glink

  07/06/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @jeannie12:
  
  You've made some good points. I'm working on the mortgage financing chapter of my new book, "Buy, Close, Move IN!," and in the writing of the new rules of mortgage finance, I've been reminded so much that the "new" rules are really a return to the "old" rules of the 1980s.
  
  When my husband and I bought our first house in 1989, it was clear that my income (as a woman, particularly, and also because it was lower) just didn't matter as much as my husbands. Everything was verified to the Nth degree, and we had to have perfect credit. The interest rate on our co-op was 11.75 percent and we felt luck to get it. We paid $144,000 for our co-op - which we could easily afford even with interest rates being so high.
  
  I think the real estate market has stagnated. I think the loan mod program isn't really working yet (hopefully it will) and I think that most of today's lenders don't remember (because they weren't working in the 1980s) how difficult it was to qualify for a loan.
  
  The only difference today is that so much now depends on your credit score - which wasn't invented until the 1990s.
  
  Thanks so much for your comment.

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  24

  mb4574

  07/24/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Did anyone notice the REPO sign at the beginning of the article. This bill will help out home buyers, but not those who already own them. It doesn't address the ARM loans that were so generously given out that no one will be able to afford when the interest rates go up.
  
  Our Tax Dollars At Work!

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  25

  Ilyce Glink

  07/24/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @mb4574
  
  You're right - there's a huge disconnect between what buyers are getting and the treatment homeowners are getting when it comes to loan modifications and refinancings. There are plenty of examples I'm finding of lenders who are not making this work - won't take principal write-downs - who are charging closing costs and fees so excessive (see bank profits!) that it doesn't make sense for some people to go thru a loan mod or refi.
  
  One little known fact: The higher your home-loan-to-value ratio, the more expensive your interest rate for the refi. Just because Fannie/Freddie/Obama are permitting 125%LTV refis doesn't mean they're affordable.
  
  Regarding ARMs: The feeling is that most of the subprime ARMs have worked their way through the system. The last of the pay-option ARMs were granted in early 2007. Many of those failed within the first 6 months. The foreclosures and delinquencies we're seeing now are either redefaults from previously modified loans (about 60% of those are re-failing) or from homeowners who bought homes they could afford with plenty of equity but who have now lost their jobs and their homes have falledn 30-40 percent in value.
  
  Until we figure out a way to get people working -with paychecks that will pay their bills - the real estate market can't truly correct itself.
  
  Thanks for your comment.

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  26

  athaya

  08/17/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I hope legislator can act quickly and do something on this and get the help to the people who need it before it's too late. So many many people can feel the benefits...and I think this bill has a lot of potential to really stimulate the economy.
  
  stop dreaming start action

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  27

  Ilyce Glink

  08/17/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @Athaya:
  
  I do think that adding a $15,000 home buyer tax credit to the mix would help things get going - if you look at who is buying right now, it's first-time buyers and real estate investors. No one else. Trade-up buyers are nonexistent because in many cases they're walking away without any cash (short sale or just low prices) and don't have the will or resources to buy something new.
  
  But see my other story on the $15,000 tax credit - it wasn't included in cash for clunkers - not sure if anything will now happen with it until October.
  
  Thanks for your comment.

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  28

  mb4574

  08/18/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Great, you'll help someone out who doesn't own a home yet, but not those who are about to lose it due to ARM's. Finance companies are selectively choosing who they give the break to. Who's to say they aren't looking at the property and deciding which ones they can sell and which ones they can't. Get with it Congress and pass something that will help people with ARMS.
  
  Yes we were stupid to sign up for one and yes we were stupid to refinance 100% of the loan, but if you had sat down with the guy who convinced me to sign, you too would own an ARM.
  
  Not that he was crooked or anything, but after being told that I only wanted to look at fixed interest, he prepared the paper work and presented me with an ARM to sign. When I told him that wasn't what I wanted, he replied they couldn't get anyone to refinance it at the 15 years I wanted. He also convinced me they would refinance it in 3 years before the interest went up. Guess what, interest didn't go up, my wife is losing her income and they won't talk to me about changing the terms or refinancing it.
  
  Some break!

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  29

  Ilyce Glink

  08/18/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @mb4574:
  
  I think there are a lot of folks who got sucked into ARMs who should have said "No." You're not alone. It's hard to say "No" to a seasoned, trained sales professional to whom you've trusted your personal financial information.
  
  I've been trying to get help the powers that be in Washington, D.C. recognize that the loan modification programs aren't working the way they should.
  
  The problem for you isn't that your mortgage went up, it's that your income went down. This new phase of foreclosures is all about people losing income.
  
  Your 100% ARM isn't a Fannie Mae or Freddie Mac Loan, so it's up to your lender to decide what to do. Unfortunately, lenders aren't doing loan mods on these sorts of loans at the moment. They're overwhelmed with those that qualify for the HAMP mods.
  
  I'll send some good job-finding thoughts your wife's way and wish you the best.
  
  Thanks for your comment.
  

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  30

  Ilyce Glink

  08/18/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Check this out: Dave Liniger, CEO of RE/MAX supports the $15,000 tax credit for ALL home buyers.

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  31

  Milton F.

  08/21/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Ilyce,
  
  Uhm, tax giveways for people who are already rich? I think that's patently absurd. I notice that the R-Gentleman From Georgia's main allies are also R-Gentlemen, with Joe Lieberman a very R-like former D and Chris Dodd (along with Mr. L) being from a state with the second richest county in the entire US (Fairfield) and probably having more million dollar listings per square mile than anywhere in the US.
  
  I grade this report as follows:
  Reporting: B - cribbing from the Senator's press release is lazy
  
  Analysis: F - Really, incomplete.
  
  Without an income qualification, you're handing my tax dollars to people who are already a lot richer than I am. Who have less marginal utility for that money. Who are buying more expensive homes where the money will make less of a difference.
  
  The Senator from Georgia, with his friends from Connecticut, Tennessee, Kentucky, Alaska, Idaho, and Louisiana are probably looking to cash in on an undervalued housing market.

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  32

  Ilyce Glink

  08/21/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @Milton F:
  
  An F-? Gee, that's a little harsh.
  
  I have really mixed feelings about the $15,000 tax credit. I think it's a bit rich, and don't think DC will hand this puppy out to the Realtors, no matter how strong a lobby they have.
  
  But I'm confused why anyone could get the Cash for Clunkers $4,500 credit (even multi-millionaires) but we're limiting the $8,000 credit to first-time home buyers only and only those who have incomes of less than a certain amount.
  
  There's a fair bit of evidence that every single house that's purchased using an $8,000 tax credit generates $67,000 in downstream economic return, what with home buyers needing to have things like window treatments, fresh paint, new carpet and nice landscaping to go with their new home.
  
  I think that's a much better ROI than what's happened with the $3 billion cash for clunkers.
  
  So, I hope DC can turn away from the health care mess long enough to vote in an extension of the program.
  
  At least, I hope that will happen, since the only pop right now in the housing market is coming from that tax credit, and if you haven't found a house to buy by the end of September, you're going to find that you don't have enough time to get your financing and closing together in time to meet the November 30, 2009 deadline.
  
  If there isn't an extension of at least the current program, I think the housing market will continue its downward trajectory, as even more people go into foreclosure and the so-called "good news" evaporates.
  
  Thanks for your comment.

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  33

  DemetriusW

  08/22/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Forbes magazine has this habit to rank the world prominent personalities in various categories and field of influences even on gender basis. This time around Forbes present 100 most powerful women in the world. Number 1 is neither Michelle Obama, nor is it Hillary Clinton ? Number One is Angela Merkel, Chancellor of Germany. First Ladies don't come that close ? Michelle is only #40. The top American ? at #2 ? is FDIC Chair Sheila Bair. #3 is PepsiCo CEO Indra Nooyi, and #54 is Supreme Court Justice Sonia Sotomayor, but she's ranked lower than the other sitting female Justice, Ruth Bader Ginsberg at #48. It takes more than the best payday loan rates to get on the Forbes 100 Most Powerful Women list.

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  34

  Milton F.

  08/24/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I upgrade the F-Incomplete to a B with that analysis.
  
  In defense of CARS, which I think is one of the best programs the government has run, you are talking a giveaway of $4500, which to get, you have to retire a car that gets less than 18 MPG and replace it with one that the government rates at 10 mpg higher than the one you are ditching. Results:
  1- GM, Ford, Hyundai are all hiring North American workers back, or restoring them to full schedules, and paying a lot of overtime. Better than Lenin ever did for workers. And a boon for the car companies. And the rest of the auto industry, like the folks who make the Clunker Bomb (it's not a bomb, but it'll kill the clunky engine deader than a JRE).
  
  2- You improve people's fuel efficiency by, at worst, 35%. That gives them more money in their pocket to go forth and stimulate the economy. Or save. Probably not save, but still. If I pay $50 to fill my clunker ever week, and I upgrade it by the minimum upgrade for the maximum credit, and do not reduce my driving any, we have reduced my fuel consumption by 35%. Less Carbon (not a bad thing), less demand for gas (benefits the whole, not just the participants).
  
  So, while a millionaire can trade in his gold plated Hummer for a more fuel efficient vehicle and get the same money a janitor gets, and yes, he has less marginal utility for the money, we are still getting his clunker off the road, improving our national fuel profile and reducing our carbon.
  
  That's the big difference between CARS and the housing bill. The public benefits. Even if the downstream spend from the $8K new house giveaway would be bigger from a $15K giveaway to any home buyer, regardless of income, the ancillary benefits would not. The new McMansion for our Hummer driver is probably larger, costing more to heat, and using more fuel to do so. Not the kind of thing I like to subsidize, and not the kind of thing you should want to subsidize either, unless you don't believe that petrofuels are actually limited.
  
  Thanks for the response.

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  35

  Milton F.

  08/24/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I forgot to add:
  I still believe that Lamar Alexander, Jim Bunning, Saxby Chambliss, Chris Dodd, D-Conn., John Ensign, Joe Lieberman, Lisa Murkowski, James Risch, David Vitter, and Johny Isakson are all liable to be in the housing market soon. Or have donors who are.

•  
  36

  Ilyce Glink

  08/24/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Milton F:
  
  Here's my big problem with the Cash for Clunkers and any extension/expansion of the $8,000 first time home buyer tax credit: You're borrowing from future sales to goose the current return.
  
  I get that you're pulling cars with 18 mpg off the highway and replacing them with (supposedly) better-performing cars. But those folks aren't going to go out and buy another new car anytime soon. If they were happy driving a clunker, they'll be happy to drive this new car into the ground.
  
  Everyone else who has a newer car, doesn't qualify. And, some old "clunkers" like my 1995 Honda Accord (which I sold three years ago) wouldn't have even qualified even though half of the back side had rusted out. It got over 25 mpg.
  
  So, who is actually going to buy all of the new cars being made by the newly rehired workers? You got me. Certainly it isn't going to be anyone who doesn't have a job.
  
  As far as the $8,000 or $15,000 tax credits go - they're band-aids. Big, expensive, fat band-aids that mask the real problem - if you don't have a job, you can't afford to buy a house or even pay the mortgage of the house you have.
  
  Buying a home now means these first-time buyers won't be around to buy a first home next year or the year after. I know the country is hoping we won't need them to, but with 3+ million foreclosures coming down the pike, maybe we should consider a real estate investor tax credit as well.
  
  Thanks for your comments.
  

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  37

  Ilyce Glink

  08/24/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  As for your second comment:
  
  I forgot to add:
  I still believe that Lamar Alexander, Jim Bunning, Saxby Chambliss, Chris Dodd, D-Conn., John Ensign, Joe Lieberman, Lisa Murkowski, James Risch, David Vitter, and Johny Isakson are all liable to be in the housing market soon. Or have donors who are.
  
  Are you making an election prediction?

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  38

  Ilyce Glink

  08/24/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  See more of my comments at $15,000 Home Buyer Tax Credit Gets Another Boost
  
  

•  
  39

  M.Asri Santoso

  08/25/09 | Report as spam

  1250009853425

  kerja sama dengan perusahaan anda

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  40

  Milton F.

  08/25/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Ilyce:
  
  I'm not going to say that the management of GM or Ford (or Hyundai) for that matter are geniuses. Clearly, in the case of GM, that is not the case. But, if they goal was to goose sales in the auto sector, get some credit moving again, get some fuel inefficient cars off the road, replace them with more fuel efficient cars (and since to qualify for the $4500, you had to have a 10mpg upgrade... I suppose we can debate the merits of DOT mpg estimations, but minimum of 10 is at least 8), etc, clearly CARS actually worked.
  
  I don't follow the housing sector, but if the $8K is working (I don't find $8K a strong enough incentive to obtain $2-300K in debt before I feel ready to obtain that obligation)...
  
  Yes, you're goosing the market now, and maybe creating a bit of a cookie jar, but you are also getting people who were driving a 1995 GMC Jimmy with a rusted out back end out of that when they were going to, rather than trying to stretch it another year or two until the economy is better off.
  
  Clearly, there is a fundamental gap in core assumptions about the role of government and other things. We will have to leave that at economist and columnist.
  
  Being a former resident of Connecticut, I wouldn't bet against Chris Dodd unless he either gutted the life/home/auto insurance market, ended capital gains exemptions, or was found to be eating babies. I'm starting to think the same of Lieberman. And I suspect something similar is true of Mr. Chambliss (who is in DC for six more, but I'm sure maintains residences around Georgia as well as in the District... )
  
  PS- I respect the Hell out of your ability to respond to each and every comment that is worthy of response. I am happy that my comments have merited response.

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  41

  Ilyce Glink

  08/26/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @MiltonF:
  
  I'm not saying that it's all bad - I just wonder if rewarding a relative handful of consumers when you're facing a sea of suffering is the right move.
  
  But when you've given trillions to Wall Street, who am I to quibble with a mere $3 billion.
  
  This country has gotten so used to trillion that million seems a mere triffle.
  
  I worry when big, big numbers don't seem real or scary anymore - and I think that's what's happening right now. Otherwise, I truly don't think we'd be seeing the stock market where it is.
  
  Thanks for your (many) thoughtful comments. Let's hope politicians continue to decide that kissing babies works better than eating them. LOL

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  42

  BusBAnker118

  08/27/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I think that paying for other people's houses is insane and rediculous.
  
  We can not afford this program really.
  
  We are buying people houses and stealing it from our children.

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  43

  Ilyce Glink

  08/30/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @BusBanker118:
  
  "Buying people houses and stealing it from our children" is certainly one valid point. But did you feel that Cash for Clunkers (CARS) was in the same vein?
  
  At least with the $8,000 first time home buyer tax credit, you're getting around $65,000 in a downstream economic kick. You can't say the same thing about Cash for Clunkers.
  
  But you're exactly right about this: There comes a time when your economy has to stand on its own two feet. The $8,000 tax credit is small potatoes compared to what we did with Wall Street. But you can't live on borrowed money forever.
  
  Didn't we just learn that lesson?
  
  Thanks for your comments.

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  44

  Ilyce Glink

  09/17/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I've posted some new blogs on what's happening with the tax credit and the big push to get it extended and expanded. Check out these posts:
  
  Realtors Issue Call to Action to Extend $8,000 First Time Home Buyer Tax Credit
  
  $8,000 Tax Credit: What Will Happen To Real Estate When The Tax Credit Expires?
  
  Free Money: How Many Homeowners Took The $8,000 Tax Credit?
  
  Feel free to leave comments here or on each of the blogs. And, check back: I'll be continuing to follow up on what's happening in Washington, D.C. with the tax credit extension and expansion.

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  45

  Ilyce Glink

  09/25/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  From Dominick on ActiveRain:
  
  Although in the minority on this issue, believe NAR is not acting in the best interests of our public.
  
  It took us a number of years to get into this situation so it will take a number of years to get out of it.
  
  Government intervention WILL NOT solve the problem. Individual actions will change the course we have set for ourselves.
  
  We are making our own sub-prime market by getting folks into homes they may not be able to affford in the next 3-5 years. Why?
  
  We all want business, for sure. We need to be more professional and advance our profession through our positive actions on behalf of the consumers. NAR seems more interested in their membership...kinda like unions. Me first mentality.
  
  Extending and heaven forbid, raising the tax credit to $15,000 will only make things worse.

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  46

  Ilyce Glink

  09/28/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  I'm interviewing sen. Johnny Isakson tomorrow (Tuesday, Sep. 29) for an update on the $15k tax credit. Watch the blog for an update tomorrow.

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  47

  e2000era

  10/13/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Hi! I am in the process of buying a house closing in Nov 5th or so. Looks like I should wait till January 1st
  
  Mr. Glink, how was your meeting on Sept 29th.
  
  Please email me @ >> e2000era@gmail.com

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  48

  e2000era

  10/13/09 | Report as spam

  Aplogizing for typo

  I missed a 's' after Mr in my first posting. I am sorry about that.

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  49

  Ilyce Glink

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @e2000era:
  
  I am in the middle of writing another post on the $8,000 tax credit right now. Stay tuned. It'll pop up before noon today!
  
  Ilyce

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  50

  e2000era

  10/14/09 | Report as spam

  Thanks

  I already own a house, so I am not qualified for the 8K credit this year, but was hoping the 15K credit happen next year and I can postponed my sale.

•  
  51

  Ilyce Glink

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @e2000era
  
  I don't think you'll get a $15,000 tax credit, but you might get an $8,000 tax credit for all home buyers within a certain income limit. Just writing it up now. Stay tuned.

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  52

  Ilyce Glink

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Okay, folks. It's up. Check out today's post:
  
  Can Sen. Johnny Isakson Save the $8,000 Tax Credit?
  
  He's positioned it extremely well, but let me know if you think this compromise will be successful.

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  53

  e2000era

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers

  Ma'am,
  
  If this bill pass, the time for any buyer will start from Dec 1st, 2009?
  
  I am supposed to close on my house first/middle of Nov. I will hate to loose 8k for not waiting the extra two weeks.
  
  Is that amount we need to pay back?
  
  When this will be decided? On Dec 1st

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  54

  Ilyce Glink

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @e2000ERA
  
  If this bill passes, the $8,000 tax credit would simply continue now through June 30, 2010. You wouldn't have to worry about falling into a hole. The real question is this: If you buy before the tax credit becomes law, will the all home buyers (as opposed to first-time buyer) status change immediately or on December 1?
  
  If it changes on Dec 1, then you'd probably not qualify because you'd have bought in November. But if it changes the status immediately, then you'd be fine.
  
  It's a great question and I'll try to find out the official answer.

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  55

  Ilyce Glink

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  UPDATE:
  
  According to Sen. Johnny Isakson's office, the provisions of the new bill will start on December 1, 2009, after the existing bill expires. So, if you buy your house before then, there's no chance you'll get the $8,000 tax credit. I'll update my Can Sen. Johnny Isakson Save The $8,000 Tax Credit blog post as I learn more as well as respond to all other comments left here.

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  56

  e2000era

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  Thanks, I will push my closing date to Dec 1st -- hoping it start on that date and don't be only for the house sold in 2010.. if that I won't be able to get the credit.

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  57

  Ilyce Glink

  10/14/09 | Report as spam

  RE: How About a $15,000 Tax Credit For All Buyers, Even Millionaires

  @e2000ERA
  
  You have nothing to lose and everything to gain by pushing back the purchase date. As it stands, you don't qualify. Pushing it back means if the tax credit amendment passes, you'll potentially be able to claim a whopping $8,000 tax credit!
  
  Let me know how it goes and what happens when you close.