The Baltimore Sun had an excellent commentary today on the housing market. As Realtors have been encouraging, others are now taking up the fight to expand the 1st time homebuyers credit to benefit a wider cross-section of Americans and to monetize the fund so you’re not out of pocket for a year. As was discussed at the NAR Economic Summit 2 weeks ago, the Administration gives great lip service but hasn’t followed-through on many of the programs. The first-time homebuyer program may be their main claim to success and it could easily have been jump-started had they enacted the $15,000 home-buyer tax credit that NAR was pushing. IF that can be monetized so that buyers can use that money up-front for closing costs, etc., and IF banks start turning loose of some of their bail-out funds to the people it was intended for, and IF HUD Secretary Shaun Donovan can make that happen like he indicated he was working on – we may be closer to the light at the end of the tunnel.
If the Administration is truly interested in helping housing lead us back out of this swamp – they’ll start listening. Or not.
Read the entire article here: “Now, How About A Homebuyer Credit for the Rest Of Us?”
In public life, it is a rare pleasure to point to a nearly unmitigated policy triumph. But, the first-time homebuyer credit may qualify. Given its singular success driving up demand in the housing market, it is time for Washington to consider how to broaden its reach.
In that vein, we recommend that Congress quickly send President Obama a bill expanding the program beyond first-time buyers, encouraging existing homeowners, as well as those dipping their toes into homeownership for the first time, to invest in a new primary residence.
To make the most of an expanded program, we urge two other changes. First, any extended credit should also be time-limited: Lest this sort of subsidy be viewed as some sort of entitlement, it should expire at the end of the year. That way, prospective buyers will be tempted to jump in now, when the economy most needs the boost.
Second, buyers should not have to wait until they receive their return next year to be reimbursed.
The federal government should make the value of the credit available to them the day they close on their new home, ensuring that a small gap in a family’s cash flow does not serve as a barrier to buying a home.
None of us can doubt that getting banks lending is a worthy goal as the president leads us out of recession. But even as other economic catastrophes – bankruptcies, bonuses, and bailouts among them – dominate the headlines, we ought not lose sight of the fact that the housing market has so frequently led the rest of the economy out of a downturn.
Getting everyday homeowners buying again could lighten the load on the rest of the economy. And that would leave Washington more room to focus its attention on more drastic, if not pressing, challenges elsewhere.