Uncle Sam’s Tax Credit for Homebuyers
Monday, February 16th, 2009
From the $789 billion economic stimulus package, first time home buyers will receive an improved, non-repayable version of last year’s repayable $7,500 tax credit. The $8,000.00 credit eligibility has been extended to September 1st, instead of June 30th.
According to the National Association of Realtors, the tax credit should generate about 500,000 more home sales this year, whether they’re moving out or possibly moving to a bigger house.
The tax credit should also help generate more economic stimulation. Realtors’ forecast additional spending of about $60,000 for every house sold, triggering a “ripple effect” or other purchases and payments, such as furnishings, appliances, remodeling, repairs, real estate commissions, moving expenses, and similar costs.
The stimulus package also has even more incentives and benefits for home owners. Everything from energy efficient heating and air conditioning, windows, doors, and insulation will apply towards the tax credits and will be extended through 2010
Of course, another program in the package should also help generate an economic effect within neighborhoods that have numerous foreclosures.
This bill provides up to two billion dollars to buy, renovate, and rent out or resell foreclosed and vacant homes.
The money generated will go to the local governments, however the actual rehabilitation, rental and resales work will go to people in the private sector.
