Stimulus Bill 2009 - Will it Work for Real Estate?
In February, President Obama and Congress passed the massive $787 Billion Stimulus Plan, which contained some rather interesting provisions that impact the real estate space.
The principal provision designed to stimulate new sales was the First Time Homebuyer Tax Credit. If a first time home buyer (or someone who has not owned a home in 3 years) purchases between 01/01/09 and 11/30/09 they will be eligible for a tax credit of up to $8,000 when they file their taxes, and depending on the timing of the purchase the credit can be applied to either 2008 or 2009 taxes. Also, unlike an earlier, weaker $7500 provision passed in 2008, this credit doesn’t need to be paid back.
Other important factors included in the Housing Market section of the Stimulus Bill were:
• The FHA, Fannie Mae, and Freddie Mac 2008 loan limits were put back into place for 2009. At the end of 2008, they lowered the loan limits which hurt the higher end market.
• It also includes a 30% tax credit on Energy Efficient upgrades to your home (up from 10%) such as furnaces, windows, and insulation. This credit will be available through 2010 and does include income restrictions.
So, the big question in everyone’s mind is “will this help, and does it go far enough?”
Speaking for myself, I just bought my first home a few days ago. I was already planning to buy, so the stimulus bill didn’t really get me off the fence or anything, but it did factor in slightly in terms of my overall price ceiling and/or how willing I was to take on a house that required some immediate improvements (and cash) sunk into it.
We’re running a poll with our Z57 clients asking them to gauge the impact of the bill – right now it’s running about 40% for “No Impact”, 44% say “Some Impact”, and the remaining 16% saying it will have a “Major Impact”.
I tend to slide into the “some impact” group myself – WHAT DO YOU THINK?
Nice writing style. I look forward to reading more in the future.
Really great post, well written, concise and comprehensive. Thank you.
Until the banks let go of the credit squeeze instead of balancing their balance sheet and begin to use realistic credit scores, I feel it will have little impact. Thanks for asking my opinion.
I agree. If I were working for one of the bailed out banks I would probably do the same thing, but the government probably needs to step in to get them to lend more aggressively.
I like the way you post your articles. You ought to write more so that you can share more of your thoughts with your readers. Keep it up. Write more on this post please.
FANTASTIC!
Great stuff. Nice to read some well written posts that have some relevancy !
Great stuff. Nice to read some well written posts that have some relevancy !
Fantastic info. I will visit again!!
thanks for information. good statistics.