Yes we have all heard the news, or at least you should have if you are in the Real Estate business, the U.S. Senate version of the homebuyer tax credit is moving. We for the moment will not speak of the numerous versions of this proposal in the House of Representatives, or of the resistance that any extension of this legislation is meeting in the White House…So I guess Happy Days are Here Again!, or are they?
It is true that the Senate version extends the tax credit, and also provides for a $6500 credit to other primary home buyers. To qualify for the $6500, current homeowners would need to have been in their current residence for a consecutive five-year period, in the past eight years. (love the policy speak of Washington!) Nicely done in the Senate version is the raising of the qualifying income limits to $125000 for single taxpayers to $250000 for joint filers. This should assist the Real Estate community in moving not only first time buyers, but in assisting those looking to move up to their next home.
It is true that fraudulent use of the credit is a concern of the IRS, (there are three letters that send a chill up the spine), and the Housing and Urban Development Secretary has taken point, with the “concerns” of the Administration. But politics being politics, the elected representatives, (hired help as Will Rogers use to say), that we send to D.C. every so often would dare not spend our tax dollars to assist them in their reelections.
So it looks like the House will either pass the Senate version en-mass, or slightly revise the language and then rush to conference committee, but time is not on the side of political delay. The passage of this legislation will assist in moving housing stock, but we in the Real Estate community realize that short sale and foreclosures’ are still a large problem. Additionally, in the Empire State, we are burdened with a taxing structure that is…archaic and yes, should I say it, unsustainable. Well, that’s for another time….