September 2009

Economists: Extend the Housing Tax Credit

More than 40 percent of all home buyers in 2009 will qualify for the federal tax credit, costing the government about $15 billion, twice the original estimate, but most housing experts applaud the policy and favor expanding it.

Now the decision is up to Congress.

Mark Zandi, chief economist for Moody’s Economy.com, believes that the credit should be expanded to all homebuyers, even investors, through summer of 2010. “The risks of not doing something like this are too great,” he said. “I don’t think the coast is clear.”

James Glassman of JPMorgan Chase also favors expanding the credit but continuing to limit it to first-time buyers.

Industry members who are lobbying for the extension are optimistic and say they believe an extension will be approved in some form. “There will be a lot of water under the bridge, a lot of compromise, between now” and a final bill, said Richard A. Smith, chairman of the Business Roundtable’s Housing Working Group.

Source: The New York Times, David Streitfeld (09/15/2009)

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

“Worst Is Over,” Fed Chief Declares

Federal Reserve Chair Ben Bernanke declared the worst of the recession over, but warned that some of the economic pain will persist.

He said the unemployment rate, now at 9.7 percent, a 26-year high, is likely to keep rising.

“Unfortunately, unemployment will be slow to come down. It will come down but it may take some time,” Bernanke said. “Obviously, that’s a very serious concern.”

The Fed chief said the economy is weighed down by tight credit, households saving more and spending less, and a still-unstable housing market.

He urged Congress to revamp the financial system to avoid a similar crisis in the future.

Source: The Associated Press, Jeannine Aversa (09/15/2009)

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Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Congress Urged to Extend Tax Credit

The National Association of REALTORS® is calling upon its 1.2 million members to urge Congress to extend the successful homebuyer tax credit into next year.

Since its inception earlier this year, the $8,000 first-time homebuyer tax credit has brought 1.2 million new buyers into the market—350,000 of whom would not have purchased a home without the credit, according to NAR. The credit is due to expire November 30.

“Now is the time for Congress to keep this recovery going by extending the tax credit through 2010 and making it available to more homebuyers. We have all seen how the credit has been a spur to bring homebuyers into the market, and have seen the beginnings of a real recovery in the housing market. Housing has always led this nation out of economic downturns, and can do so again,” said NAR President Charles McMillan.

Write Congress Now

REALTORS®, the leading advocates for homeownership and housing issues, will be writing to their Senators and Representatives to tell them of the successes with the tax credit thus far, and press them to extend and expand it now.

McMillan added that the market has improved, but it has not yet fully corrected itself. “The credit needs to be available for an additional period of time in order to sustain the progress that’s been made so we can continue to see our markets fully recover. Uncertainty about the future of the credit will dampen consumer demand. The only way we can assure that the progress we’ve made can continue is to extend the credit and to do that now,” he said.

As the current deadline for the credit looms, potential homebuyers need to complete a contract, satisfy any contingencies, secure financing, and go to closing by November 30. In today’s market, NAR estimates that it generally is taking between 45 and 60 days from contract to closing.

“That means potential homebuyers who qualify must act now, and so must Congress,” McMillan said.

Source: NAR

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

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