Our Spring Newsletters were just sent out describing a proposal to make the $7,500 tax credit for First Time Homebuyers an actual Credit and not a loam that had to be paid back over time to the Federal Government....
Well, now a new step has been taken by the Senate to approve something even more beneficial to buyers...READ ON!
Senate Unanimously Approves Housing Market Stimulus Amendment
WASHINGTON - The U.S. Senate Thursday, February 5, 2009, unanimously approved an amendment to stimulate the nation's declining housing market by offering a $15,000 tax credit to individuals who purchase a home in the next year.
"It is time to fix America's problem, not throw money at the symptoms. It is time to fix housing first. It is rare that we have a road map to success in times of difficulty, but this country has once before realized a housing crisis every bit as bad as the one we have today and economic troubles every bit as dangerous," U.S. Senator Johnny Isakson, R-Ga., said. "We have a pervasive housing problem, and we have a historical precedent that works. I am proud this Senate has joined together, learned from history and repeated a method that worked by adopting this amendment." Specifically, the amendment to the pending economic stimulus bill would provide a direct tax credit to any homebuyer who purchases any home. The amount of the tax credit would be $15,000 or 10 percent of the purchase price, whichever is less. Purchases must be made within one year of the legislation's enactment, and the tax credit would not have to be repaid.
The amendment would allow taxpayers to claim the credit on their 2008 income tax return. It also seeks to prevent misuse by only allowing purchases of a principle residence and by recapturing the credit if the home is sold within two years of purchase. The amendment would sunset the current $7,500 housing tax credit on the date of enactment.
Isakson has pushed hard for a non-repayable tax credit for homebuyers because he knows that it will work. In the mid-1970s, America faced a similar housing crisis when a period of easy credit and loose underwriting flooded the market with new construction. Interest rates rose, the economy slowed and America was left with a three-year supply of vacant homes. Congress responded by passing a $2,000 tax credit for anyone purchasing a new home for their principal residence. Isakson believes the results were clear and swift as home values stabilized, housing inventory dropped and the market recovered.
Last year, Isakson introduced legislation to specifically target those homes that were causing the unprecedented increase in housing inventory by offering tax credits to individuals purchasing a foreclosed home or a home where foreclosure is pending. In April 2008, the Senate passed legislation to stimulate the nation's declining housing market that included Isakson's proposal. However, the final version of the legislation that was signed into law included only a $7,500 tax credit for first-time homebuyers that must be repaid over a 15-year period. The amendment that passed Thursday would sunset that $7,500 tax credit.
Our team at Jennifer Young Homes is continually watching for changes in the real estate market that affect all of our buyers and sellers. Visit our website anytime for information and updates on what's going on. Go to http://www.jenniferyounghomes.com/ to check us out!