Breaking News! Senators agree to extend home-buyer tax credit
By Stephen Ohlemacher,Associated Press Writer
WASHINGTON — Senators agreed Wednesday to extend a popular tax credit for first-time home buyers and to offer a reduced credit to some repeat buyers.The tax credit provides up to $8,000 to first-time home buyers but is set to expire at the end of November. The Commerce Department said Wednesday that new home sales fell 3.6% in September, and some industry representatives blamed uncertainty about the tax credit.Senators agreed to extend the existing tax credit for first-time home buyers while offering a reduced credit of up to $6,500 to repeat buyers who have owned their current homes for at least five years, said Regan Lachapelle, a spokeswoman for Senate Majority Leader Harry Reid, D-Nev.
The tax credits would be available to home buyers who sign sales agreements by the end of April. They would have until the end of June to close on their new homes, according to a summary of the legislation being circulated among lawmakers.
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Industry representatives said uncertainty about the tax credit is hurting new home sales. September’s decline was the first since March.
It takes 45 days to 60 days to close on a house, making it unlikely a sale made today would be consummated by the end of November, said Lucien Salvant, spokesman for the National Association of Realtors.
“Buyers right now have an incentive to hold off, not knowing whether the credit will be extended,” Salvant said.
About 1.4 million first-time homebuyers have qualified for the credit through August. The National Association of Realtors estimates that 350,000 of them would not have purchased their homes without the credit.
This credit continues to help first-time homebuyers, but still leaves out a large group: those who have owned a home for fewer than 5 years. Should those current homeowners who are moving after owning their home fewer than 5 years be ignored?
What about those who need to move or relotate for employment? Aren’t they still taking a hit selling a home even if they haven’t owned it 5 years?
What about those who are downsizing to avoid foreclosure with unemployment uncertainty? Should they be left out?
What about those who are having other financial trouble due to divorce, etc.?
How do YOU think lawmakers did on this decision?
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