Who wants a $15,000 home buyer tax credit? In Georgia parlance, “Don’t y’all raise your hands at the same time.”
Sen. Johnny Isakson (R-GA) proposed last week that all home buyers (not just first-time buyers or those who have not owned a home in the past 3 years) be given a $15,000 refundable tax credit. The Mortgage Bankers Association quickly signaled its support for the measure. As of today, the National Association of Realtors hasn’t said much, but why wouldn’t they love this?
In my experience, you can always count on the Realtors and Mortgage Bankers to support anything they think will increase business for their members. More importantly, what does the Obama Administration think?
I’m in Washington, DC for the next few days for the annual meeting of the National Association of Real Estate Editors (NAREE), an eighty-year old organization that was once populated by great real estate writers from hundreds of newspapers. (You can imagine how our ranks have thinned. As Mary Doyle Kimball, the executive director of NAREE pointed out, most of the 130 real estate reporters who are attending this week’s events are paying their own way as freelance writers. But, I digress.)
The speakers during the conference are excellent and I’ll be blogging about some of what I’m learning. But back to the $15,000 tax credit for home buyers: HUD Secretary Shaun Donovan just spoke before our group of real estate writers and outlined some of the Administration’s housing priorities. He then took questions. I asked him about Sen. Isakson’s legislation. Here’s what he said:
“The $15,000 tax credit was what they proposed at the beginning of the process. And it was cut back due to costs. I’ve spoken to Geithner about it, and we’re trying to determine how expensive it will be - and it could be a significant cost - and what the stimulative effect would be. Because it’s not just limited to first-time buyers, it could be that lots of people who would have bought homes anyway will claim the tax credit. We haven’t ruled it out. We’re just beginning the process of discussing it.”
In other words, it’s a definite “maybe.” That “maybe” is important because it signals that the Administration recognizes that while a bottom may be forming in the housing market, you’ve got to do something to sop up the millions of foreclosures (plus the millions more that may come as the unemployment rate continues to rise).
My guess is that the Administration will extend the current $8,000 first-time buyer tax credit well into 2010. But I don’t see Treasury or HUD sweetening the $8,000 pot further.
Stay tuned for more blogs from the NAREE conference.
Read More:
- Is the $8,000 First-Time Home Buyer Tax Credit Enough to Save The Housing Market?
- $15,000 Home Buyer Tax Credit Gets Another Boost
