Stimulus Bill Passed-What Does That Mean for Housing?
Friday, February 13th, 2009Last week the Senate approved an amendment to the pending economic stimulus package that would give a tax credit up to $15,000, for anyone buying a primary residence within the year period, and it would not have to be repaid. This proposed amendment would have added $19 billion to the stimulus package. As lawmakers looked to trim the large price tag of the stimulus package, this amendment was killed, but was replaced with a similar yet smaller measure.
Yesterday, the Wall Street Journal reported:
The $15,000 homebuyer tax credit didn’t survive the final negotiations on the stimulus bill. Instead, Congress slightly increased to $8000 an existing $7500 credit for first-time homebuyers and eliminated repayment provisions. Congressional negotiators said that $8000 number isn’t yet finalized.
The move was sure to disappoint those who had favored a more generous $15,000 credit for all home buyers in the Senate bill.
The new credit is retroactive to December 31, 2008, which means that anyone who buys a house this year, through August, won’t have to repay it. First time buyers who used the credit in 2008 still have to pay it back over a 15-year period.
The news is bittersweet for the real estate industry, but lawmakers who support the bill are not giving up and will continue to push for the increased tax credit in a separate stand alone bill.
Tax Credit for Homebuyers