With strong lobbying from various groups, President Obama signed a Homebuyer Tax Extension, thereby giving 3 additional months for qualifying transactions to close (and let’s face it, short sales take time and even with the extension some just won’t close in time). And now there are already many in the real estate industry clamoring for another tax credit for first-time and repeat home buyers. Should we entertain such an idea? My answer is quite simply an absolute NO!
With jobless claims rising, sales of previously occupied homes slipping, and consumer confidence decreasing, there is no indicator that more government intervention (at taxpayers’ expense, of course) would help stabilize the real estate market. With ineffective programs such as HAMP keeping people in house they can’t afford, tax increases derailing small businesses, and micro-management at levels never seen before, Uncle O’s administration is merely prolonging the crisis. If the only thing that can keep the real estate market moving forward is an additional tax credit to entice buyers, then there are substantially deeper issues with the market that would need be addressed.
Without getting into deeper arguments about the evils/benefits of capitalism, it is one of the main principles on which our nation and its economy were founded. A strong economy is a FREE economy in which profit-motive is staunch and provides the catalyst for investors and inventors to flourish. Sustainable economic growth will result when the federal goverment forgoes further intervention and allows investors to revitalize the market with astute investing strategies and implementation. With that said, let’s heal this market, one investment at a time.