Comments on: The $8,000 Tax Credit Question: Are We Setting Ourselves Up For An Even Bigger Problem? http://www.biggerpockets.com/renewsblog/2009/11/14/8000-tax-credit-questionare-setting-bigger-problem/ Learn, Network, Invest Sat, 11 Feb 2012 20:37:50 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Shari Poseyhttp://www.biggerpockets.com/renewsblog/2009/11/14/8000-tax-credit-questionare-setting-bigger-problem/#comment-75362 Shari Posey Mon, 16 Nov 2009 16:12:12 +0000 http://www.biggerpockets.com/renewsblog/?p=8570#comment-75362 All of the first-time buyers that I'm working with would have continued their home search without the tax credit. Of course, they are happy it was extended but they were prepared to buy without it being extended.I think the move-up buyer tax credit is ridiculous! Fortunately, not that many people will fit in the narrow parameters. For those who do, the credit amounts to nothing more than subsidizing a fairly weathly person to buy a new property. In order to sell, you must have equity or savings so you really don't need a credit. In order to get the credit you need to buy a home worth more than $300,000--that's a lot of house and takes a sizeable income to support it so they would not need a credit.I don't think the credit is doing much to prop up the market. The biggest proppers (and creators of future risks are: FHA loans with 3.5% downpayment; banks holding on to defaulted loans too long; government intervention like moritoriums, rent-backs, sharing losses with the banks, etc. All of the first-time buyers that I’m working with would have continued their home search without the tax credit. Of course, they are happy it was extended but they were prepared to buy without it being extended.

I think the move-up buyer tax credit is ridiculous! Fortunately, not that many people will fit in the narrow parameters. For those who do, the credit amounts to nothing more than subsidizing a fairly weathly person to buy a new property. In order to sell, you must have equity or savings so you really don’t need a credit. In order to get the credit you need to buy a home worth more than $300,000–that’s a lot of house and takes a sizeable income to support it so they would not need a credit.

I don’t think the credit is doing much to prop up the market. The biggest proppers (and creators of future risks are: FHA loans with 3.5% downpayment; banks holding on to defaulted loans too long; government intervention like moritoriums, rent-backs, sharing losses with the banks, etc.

]]> By: Eric Hemplerhttp://www.biggerpockets.com/renewsblog/2009/11/14/8000-tax-credit-questionare-setting-bigger-problem/#comment-75331 Eric Hempler Sun, 15 Nov 2009 22:23:40 +0000 http://www.biggerpockets.com/renewsblog/?p=8570#comment-75331 Awesome. I've been looking for something like this for a while. Awesome. I’ve been looking for something like this for a while.

]]> By: Dennis Normanhttp://www.biggerpockets.com/renewsblog/2009/11/14/8000-tax-credit-questionare-setting-bigger-problem/#comment-75330 Dennis Norman Sun, 15 Nov 2009 21:58:22 +0000 http://www.biggerpockets.com/renewsblog/?p=8570#comment-75330 Ted Gayer of the Brookings Institute made some excellent points about the negative side of the homebuyer tax credit....including what he determines is the real cost to taxpayers for each buyer (over $100,000), the large number of buyers that would have bought anyway, the artificial market it creates, etc... Ted Gayer of the Brookings Institute made some excellent points about the negative side of the homebuyer tax credit….including what he determines is the real cost to taxpayers for each buyer (over $100,000), the large number of buyers that would have bought anyway, the artificial market it creates, etc…

]]> By: Eric Hemplerhttp://www.biggerpockets.com/renewsblog/2009/11/14/8000-tax-credit-questionare-setting-bigger-problem/#comment-75324 Eric Hempler Sun, 15 Nov 2009 13:39:29 +0000 http://www.biggerpockets.com/renewsblog/?p=8570#comment-75324 I really think they should have let the original tax incentive expire and see how the economy reacted. We were already entering recovery mode when the decision was made to expand the tax incentives. Right now we have a false sense of what market conditions are because of the current tax incentives. Until these incentives are done we really won’t know what the condition of the market really is. I really think they should have let the original tax incentive expire and see how the economy reacted. We were already entering recovery mode when the decision was made to expand the tax incentives. Right now we have a false sense of what market conditions are because of the current tax incentives. Until these incentives are done we really won’t know what the condition of the market really is.

]]>