DISQUS

Angelica Richardson · 3 months ago

I think it's good that Sen.Isakson went "back to the drawing board" since his previous bill is not going anywhere. A simple extension is reasonable. But why June 2010? There's so much talk about 2-3 years of Foreclosures. I think a 12/2010 extension would be better. Too many extensions, and the gov't will start looking like the weekly ads from mattress retailers and used car dealers. After awhile, the urgency to buy will not be there.

Jay Thompson · 3 months ago

Angelica - There's already a lot of discussion surrounding the cost of this thing, so I suspect that may be tempering the potential extension date...

Wayne Harriman · 3 months ago

Great info, Jay! So, is this "Plan 9 from Capitol Hill"? Like it's namesake horror film of equally dubious quality, it seeks to resurrect some dead things to try to make things better. And believe me, I think those other five bills are dead, as they've been buried in a graveyard called the Ways and Means Committee forever. I'm not sure any of these proposals will ever be (or should be) passed but, as I've said before, whatever they're gonna do, let's do it quick and stop all this political BS so we can get back to selling homes to the people who can afford it. I know, fat chance...

Jay Thompson · 3 months ago

"I know, fat chance..."

But we can always hope Wayne.... (I think the other five bills are dead too)

Colleen Kulikowski · 3 months ago

We are now dealing with the number of home buyers that believe that since the last tax credit expired and the new one was "better" that they will just wait and see what comes along. They believe that it will be better in the next round. Perhaps it will, but just like the number of homes that kept increasing at insane rates, there has to be a swing back to normal somewhere.

Jay Thompson · 3 months ago

Agreed Colleen. I've had people tell me, "I'll wait for the next round, it'll be better". At some point, there will be no next round... Someone is going to close the day after the last tax credit is in effect, and that's going to be painful.

NJShore · 2 months ago

Well, I don't find anyone really interested in the tax credit. It's the FHA loan for 3.5% down and sellers helping with closing costs that has sold houses for me. Of course, those few homes that I have been able to sell were described as "distressed" or the owner was willing to accept the fact that the house was worth much less than the asking price. I don't think reality has real hit most home owners, yet. Even when I do the math for them showing what a person earns in this area for a job they think is good for the area, or, the type of person that I should try to market the home to for a sale.

Portland Real Estate · 2 months ago

My guess is that they will not let anything out of the committee until the current credit is gone. If people think that there is another one coming, then they may hold off until then to buy which would kill the current rush that is happening right now.

-Tyler

Kevin · 2 months ago

I agree Tyler. There is no way that Congress is going to offer higher incentive to buy after this current cycle and announce it before the current offer expires. Which is probably why the senator is straddling multiple bills. Throwing everything on the wall to see what sticks.

Betty Jung · 2 months ago

Just attended our Portland Board of Realtors luncheon where a Washington D.C. rep from NAR on Governmental Affairs spoke - the concensus he said is split between the Democrats and Republicans with more leaning towards extending it. Isackson is a former NAR chap. They are also proposing higher loan limits for Fannie, Freddie and FHA.

Bruce Dietz · 2 months ago

If the government really wants to stimulate the housing industry, just remove the first time homebuyer restriction and leave the tax credit at $8,000. This would achieve several objectives: #1 It would be a strong incentive for a current homeowner to buy a new, larger home. #2 It would spur the construction industry as the demand for new homes increases. #3 It would create an inventory of good, older homes for first time buyers to purchase. I know what you are thinking...you can almost hear Ray Charles singing, "What a Wonderful World"

Arizona Real Estate · 2 months ago

Agreed, Bruce. In an ideal world that would perfect, right? LOL..My guess is they will leave the tax credit as is and extend it until at least May of 2010.

Indianapolis New Home Builders · 2 months ago

Fantastic idea Bruce!

mattmont927 · 2 months ago

Isakson is smart enough to know that an extension with a $15K expansion is unlikely, but he is hoping for at LEAST the extension (keeping it at $8K for at least 6 months) to get something out of it. Thus, the reason he supports both bills. I hate phrases like this but here goes.. Shoot for the stars, and if you miss them, you'll at least land among the clouds...or something like that...

Sincerely,

- A potential first-time homebuyer who is waiting on a Short Sale approval from the bank, and hoping to close before 11/30.. You guessed it.

bw788 · 2 months ago

Same situation here....have been waiting 4 weeks on approval from the bank on a short sale. Curious to know if others are waiting more/ less time for short sales? If we cannot close by 11/30 and credit is not extended...will be pulling offer out.

Jay Thompson · 2 months ago

BW and Matt - There are a TON of factors that go into how long it can take a short sale to be approved. Not the least of which is the lender involved, and even the specific indivual loss mitigation officer assigned to the file. If two lenders are involved, it can get really complicated.

I've seen short sales close in as little as 4 weeks, and have had others take close to six months. Unfortunately you're at the mercy of many people, none of whom you have any control over and few of whom even care if the deal closes.

Would love to have you all come back here and let us know how it's going. Best of luck to you both!

BW · 1 month ago

Well we pulled our offer on the short sale, and found another house that was a foreclosure. It was owned by Fannie Mae, and was such a smooth, efficient process! Our offer was accepted in a week, and we close on the 13th!

Name · 2 months ago

Been waiting for approval from BOA since JUNE!!!!!!!!!!

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Kyle · 2 months ago

I totally agree with you about not extending it. There is only so much money in the barrel (of course, that all goes out the window when our government borrows like it does and the Fed prints like they do), and I think that the long term consequences of more government debt just doesn't justify the short run artificial boost it provides to the economy. But I'm a younger real estate agent, so naturally i have a lot longer timeline to worry about how bad the government is messing with my future earnings than all you old dogs... ;)

Joshua Bucio · 2 months ago

Regarless of the outcome, I really hope the credit is at least extended into next year.

This has been an important tool in getting homes sold this year.

Brad Rachielles · 2 months ago

Jay - Great post. I was hoping to add to the thought process, but find that your readers/commenters are also very insightful. The prospect of future extensions, upgrades and criteria changes for qualifiers may be having a detrimental effect on the first timer, and I concur with the writer who says that we just have so much that we (the taxpayers) can spend. It would seam that there would be benefit immediately for announcing that there would NOT be any new program, but that anyone in a transaction before the deadline could reap the rewards of this bill. This may spur the buyer to consider a short sale with it's longer transaction time a more viable choice. In my opinion, the better move would be to have real pressure exerted on lenders to impliment Real Loan Modifications, getting rid of the Ghost Inventory and returning to a market where prospective sellers see value in listing standard sales, increasing good inventory and returning to normalcy. I'd love comments - good or bad. Thanks Jay.

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gdallaire · 2 months ago

I remember getting my call to action letters to all my local representatives. As a Realtor any type of legislation like this will have a positive impact on the short term.

Being a fiscal conservative/libertarian i'm really starting to question the actual impact of trying to control a free market. We are starting to see this type of legislation in other parts of our economy. Once you implement these type of programs they are extremely hard to get rid of and become a norm instead of an actual short term incentive.

Are we trying to postpone the inevitable market correction? It's time we actually let a market do what it's supposed to do. Trying to control a free market is not capitalism it's something extremely different.

Bookkeepers Now · 2 months ago

The existing program was put in place to help the economy and housing affordability but stretching the measure too far beyond its original scope is a bad idea. It costs billions of dollars and excludes millions of Americans who rent or bought their homes before the program was available.

sunshin49 · 2 months ago

Let's just extend the tax credit - let's not get greedy and start adding more onto it. This is like being a kid in a candy store - your parents gave you one piece of candy now you are throwing a tantrum and want more

andys2i · 2 months ago

Remember when the fed kept interest rates low in the 00's. Look at the result of that. seems like de ja vu as the housing market is artifically proppoed. As discussed, http://www.savingtoinvest.com/2009/02/15000-fir... , my opinon is that the existing credit will get extended for 6 months under the same conditions.

best bank rates · 2 months ago

Proposed plan was of amount $15000 and got approval of $8000, almost half of it. I think now the plan of action is to be; propose the double amount or double days than what actually is required.
On serious notes, i wish new propose plan gets the approval.

jeannicole · 2 months ago

It is the least the government can do. Recently all of my tax dollars have been going toward bailing out Wall Street fat cats, can I just get a little of my money back? Gheesh!

samdodd · 2 months ago

$15,000 would be a real boost to the Real Estate market, that is exactly why it will never happen. These clowns in Washington just don't get it. O well what can you do? I hope at the min they can push through an extension to June 2010.

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Danielle · 2 months ago

I, too, am waiting on a short sale house. We had out offer in July and still haven't made it through Phase 1. There is no chance to close by Nov. 30th. If it is not extended, I will have to retract my offer. They need to extend it at least 6 months to compensate for the lack of sales in the winter months, IMO.

Name · 2 months ago

We need an extension just to complete the purchase we started back in JUNE that is stuck in BofA "short sell hell"!!!

Rob · 1 month ago

They should extend to credit to ALL buyers for at least another six months... but my suggestion would be to exclude all foreclosed and short sells from it. These sales are already a great deal to the buyer and don't need the additional incentive. The $15K idea seems a little far fetched and too costly, but the current 8K for all buyers except those under forclosure or short sale would be a good compromise.

Gail · 1 month ago

Apparently the credit will be extended till April and phased out over the next few quarters as discussed here: http://www.savingtoinvest.com/2009/02/15000-fir...

corbitr · 1 month ago

Hopefully this is extended and expanded prior to the deadline. Home prices in Florida are finally down to where I can afford to buy a home, and would like to be able to take advantage of this program. Also since 30yr fixed rates are near historic lows, there has never been a better time, and the tax credit is great incentive. By the way this is the only part of the stimulous that is actually working. The reason? Because it is a tax credit, not a bailout, not a freebie. Proof that tax cuts are what stimulate not handouts.

Jay Thompson · 1 month ago

For those following the home buyer tax credit extension, see this post for the latest developments. Credit extension and expansion passes both House and Senate:

http://www.phoenixrealestateguy.com/home-buyer-...

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