Comments on: NAR Frequently Asked Questions Homebuyer Tax Credit Changes

By: Kendyl young

Kendyl young — Mon, 09 Nov 2009 21:52:48 +0000

Clay- I am sorry, but I don’t think you qualify for the existing home owner credit. You must close escrow between the day Obama signed the bill (November 6, 2009) and April 30,2010.

By: Kendyl young

Kendyl young — Mon, 09 Nov 2009 21:48:16 +0000

Dan- thank you for taking the time to comment. I don’t understand, however, why it is a bad thing to convert renters to home owners. You say this does not help absorb excess housing. What are you looking for- an influx of rich foreigners to come any buy our homes? Converting renters to buyers frees up lower cost rental units, providing much need housing for those who still can not buy. California is still gaining population and, while there might be excess housing in outlying areas, we are seeing a real lack of housing inventory in the urban areas.

From my point of view, the weak housing market has more to do with loans that reset with higher payments & job losses. These two factors led to troubled sales which led to lower prices. Excess housing, at least in Glendale, is not a factor.

By: Clay

Clay — Mon, 09 Nov 2009 18:59:19 +0000

where is my credit if i bought a house in June 2009 and owned one for 5 years prior to this

By: Dan

Dan — Mon, 09 Nov 2009 17:06:19 +0000

As a realtor, I get why you are a believer in this tax credit – but the reality is that this a very poorly targeted stimulus that does nothing to address the core problems. Approximately 1.9 million buyers are expected to receive the credit, but more than 85 percent of these would have bought a home without the credit. At best you may have simply accelerated the purchase. At worst, most of the new home sales just result in moving renters to owners, which does not absorb the excess supply of houses. The core of our weak housing market is that the housing bubble led to too many homes being built, and the recession has led to a decline in household formation. By moving renters into owners, the tax credit does not address either of these causes.

We still have to “pay the piper” for our nearly decade of real estate excess and prices in areas like LA are still very out of alignment with household incomes (don’t be distracted by the “good news” in the recent median sales figures – less than 25% of households in the Santa Monica zip have incomes that can support those current median prices). These efforts, along with all of the foreclosure “initiatives”, are simply giving money away and delaying/deferring a neccessary, even robust correction in the marketplace (we will see a massive correction in the upper ($700k plus) range that will again place pressure on the low end of the market – it is just a matter of time).