Tax Credit Scaled Back to $8K for First-Time HomebuyersPosted by Jolenta Averill, Broker on Thursday, February 12th, 2009 at 8:23pm.
The new tax credit for first-time homebuyers that's included in the economic stimulus package was far less than the $20,000 the homebuilding industry wanted. Analysts expect the credit of 10 percent of the value of a home, up to $8,000, to provide only a modest boost to the battered U.S. housing market. Last year, Congress enacted a $7,500 tax credit for first-time buyers, but that had to be paid back over 15 years and the impact on home sales was negligible.
The tax credit is part of the economic stimulus package expected to be signed soon by Obama. It was scaled back from a Senate proposal of $15,000 and is limited to first-time buyers who act between January 1st, 2009 and December 1st, 2009. First-time buyers are defined as those who haven't owned a house for at least three years.
The credit of 10 percent of the value of a home, up to $8,000, if approved, would cost the government an estimated $6.6 billion. It would start phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000. Buyers would have to repay the credit if they sold their homes within three years.
Hi, and welcome to our Madison real estate blog. Whether you're a consumer, journalist or Realtor, we encourage you to share your thoughts by leaving a comment. Here you'll find relevant local and national real estate information, as well as market statistics, insight, and information about a variety of neighborhoods and real estate listings. If you'd like more information about anything in particular, please use the contact form and I'll be happy to help.
Jolenta Averill, Principal
Lake & City Homes Realty