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GroupsReal Estate TrendsThe Economic Stimulus and its Effects on the Real Estate MarketReal Estate TrendsThe Economic Stimulus and its Effects on the Real Estate Market
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Group MemberWith the approval of the economic stimulus bill by the Senate, the package totals are an overwhelming amount over and above $750 billion. This package is a mixture including not only federal spending but also various tax cuts designed to bring some life back to the economy of the United States.
There are many different provisions included in this bill. Many of those provisions would likely still be viable no matter what legislation follows. It's the responsibility of your realtor or real estate broker to be as informed as possible in regard to any and all effects this stimulus package could have on the real estate market, and therefore your ability to purchase a new home.
This tax credit is expected to encourage more buyers to enter the real estate market, resulting in additional demand for real estate properties. While assuming interest rates remain steady at this present low level, and the usual spring market sales increase, this credit could potentially provide a seller's market for a short period of time.
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Group MemberHappy Mother's Day Nicole. Thanks a million for putting effort in improving our understanding, on role of Economic Stimulus & its relevance in Real Estate. This information is of great importance, to a novice real estate professionals like me.
Group MemberI just commented on this on the NAR group on LinkedIn, but I'll offer a quick thought here (undoubtedly biased by the fact that I work in a still-healthy real estate market, Austin, Texas). Because the housing sector is so important to the larger U.S. economy, this tax incentive has been helpful, and an extension may also be in order. Let's not let our industry become permanently dependent on this kind of incentive, however, the way auto manufacturers made rebates and other incentives a permanent and constant feature of the way they sell.
Group MemberI agree that incentives are helpful now and should not be made permanent - we want our future homeowners and first time buyers to have skin in the game. If something is earned, it is valued more. Plus, government intervention is scary - there are always unintended consequences.
The silver lining in our market place is that first time buyers can now afford homes - our young people once again have a chance to own a piece of California with the FHA loan limits and small down payment requirements. Ironically, 75% of our closings have been REO properties, and our REO sellers are avoiding FHA buyers because of the appraisal, repair and other last minute requirements - in addition to the long processing times.
First time buyers have the ability, motivation, and incentive to buy - but our sellers don't want them.... An unintended consequence of a government?
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