Will $15,000 tax credit help?

tilenutFebruary 10, 2009

If the Senate version of the $15,000 tax credit for home buyers passes intact in the economic stimulus bill, what impact will it have on your decision to buy?

What if is more like the current House version, which must be paid back, will that make a difference?

Here is a link that might be useful: FAQ's Senate home buyer tax credit

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wonka27

I just read an article on USAToday that states house democrats are saying that amount will be reduced. They don't state how much. Nothing is being said about it being paid back, but I'd guess probably not.

    Bookmark   February 11, 2009 at 10:40AM
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muddypond

The Georgia senator that inserted the tax credit into the Senate bill turned around and voted against the bill. Now it doesn't look good for the whole 15K.

    Bookmark   February 11, 2009 at 1:39PM
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FatHen

The sellers and home builders need to accept reality and lower their prices, that might get things going again, LOL! The tax credit is a way for the real estate industry to make tax payers pick up the difference. I find the whole thing repugnant. Also, it just encourages more home buying by people who can't afford it, part of what got us into this mess. No, I don't intend to use the tax credit if it passes. I'm not planning on buying anytime soon. Prices are still too high, there is still a lot of loan fraud going on, a lot of companies going out of business. I think things are going to be risky for quite awhile yet. I sold my house a few years ago and felt prices were too high, and lending out of control then, so I didn't buy another house. I am quite happy renting, and just waiting it out. Though I was never overextending myself on past house purchases anyway, I'm going to be doubley careful on the next one, now that I've seen the disaster some of these deals ended in. IMO the govt should be looking very closely at the industry for fraud instead of deliberating how much of a bailout to give them. IMO also, the money will go to the industry, not to help homeowners. That's probably just a lot of feel-good politics.

    Bookmark   February 11, 2009 at 3:35PM
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nutbunch

Not like it's planned.

The banks making the loans aren't going to care about a future credit on your return you haven't filed yet. So it won't help you qualify for a loan.

A house is such a large purchase.

It may help where there are people sitting on the fence waiting for the bottom of the market. The $15,000 might be an insurance policy somewhat on if the house further declines after you purchase it.

Very few 1st homebuyers fall into that category. So the investors will still be on the fence waiting for the market to fall all the way before starting to purchase to rent or flip.

    Bookmark   February 11, 2009 at 5:42PM
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muddypond

The $15K tax credit was eliminated. Instead, the first time home buyers credit of $7.5K was bumped to $8K and extended through 2009. It isn't clear if it still needs to be paid back, as was the earlier case.

They blew it. The first time credit wasn't doing anything. The $15K credit might have actually stimulated sales and construction.

    Bookmark   February 13, 2009 at 7:27AM
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wonka27

You got that right. My wife and I are building a new home. That tax credit, even if $8000 for everyone would have went a long way to buying new furniture, etc. Now we will make due with what we got.

    Bookmark   February 13, 2009 at 1:59PM
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popeda

My DS was very happy with his 7500 credit until heard that it might go to 15K and be non-repayable. LOL

He is getting sprinkler system for yard and then reducing debt with the rest. Helpful? Seems like it.

    Bookmark   February 14, 2009 at 8:37AM
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triciae

The tax credit for anybody purchasing a home doesn't make sense & I'm glad it's been kept at applicable for first time homebuyers only.

The idea is to spur sales & move existing inventory of foreclosed homes. That only works for first time buyers.

If I, as a homeowner, purchase another house...well, then I have to sell the one I'm living in now. That just puts another house on the market. Net wash in the inventory numbers.

/tricia

    Bookmark   February 14, 2009 at 10:26AM
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wonka27

Tricia -

Yes, but, most likely people buying a second home are probably moving up. I know in our area the problem isn't homes up into the $200Ks but the homes that are $300K plus and new construction ($200K is approx. ave existing home value in my location). Maybe a tax credit helps people move up and put more affordable housing on the market for the first timers.

    Bookmark   February 14, 2009 at 3:23PM
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