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I don't get the retroactive part.
If it's supposed to be a carrot to the hesitant, why give it to somebody that already ate?
That's just a thank you.
Edited........should have read it first...it would NOT be retroactive. "The legislation wouldn’t be applied retroactively to purchases completed before the date of enactment, Watson said. "
Because now this "new" homeowner can go out and buy "stuff" for their new home..get it ?
Lets just keep trying to artificially prop up the housing market instead of the market naturally doing it.....
Yep, this will work.....sure
Yep, it'll work just like every other attempt by gov't in the history of the world to prop up prices.
The irony is the big loser's are going to be the people taking advantage of this. That credit isn't going to seem very big 10 years from now when the home is still worth less than they paid.
It's amazing that even after all thats happened so few people seem to have learned anything. The notion that you better buy before rates go up is one example. Yeah, better buy now so when those rates go up your underwater on your mortgage. wtf? Doesn't anyone know the relationship between home prices and mortgage rates? Or what the historical level of mortgaga rates is? Or the fact that housing doesn't mimic the stock market but instead moves in long, often muli-decade cycles? Or that creating bubbles doesn't solve problems it makes them worse?
Location: Georgia, on the Florida line, right above Tallahassee
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It shouldn't be a set dollar amount to be fair. It should be a percentage of the home price.
You buy a home for 200K, you get 15K off.
You buy a home for 300K, you get 15K off.
That doesn't make any sense.
I say we just dispense with the idea of "credits" and just give people homes. And a place to live and breed and some food. We'll call this new program, "indentured servitude." They can sign a contract and everything. And we'll all be cool with that.
The law provided for punishments for runaway indentured servants. In 1638, for example, several lashes were the punishment for running away. In the following year, the punishment was extended to hanging the runaway. By 1641 the law was changed such that death would be the punishment unless the servant requested that his or her service be extended after the expiration of the contract. The service could be extended up to twice the time absent, not to exceed seven years...
Helping someone afford a home they can't afford right now is like giving beer money to a guy that doesn't need to be drinking a beer right now.
Maybe it will act as an incentive for buyers to go ahead a purchase a home of quality and not some poorly constructed and inexpensive vinyl box that sits next to 150 other vinyl boxes.
A quality home is worth more and costs more than a cheaply made one. With developers using inferior materials and shady labor, they can build a home for much less than it costs to build a quality home. Sellers with quality homes who are priced fairly can't compete with the cheap inferior homes on the market.
I wish more people appreciated quality instead of the illusion of luxury some developers sell. Throw cheap stainless appliances and one slab of granite into a giant box and place it across the street from a neighborhood swing set and people go gaga over it.
Sorry for venting and taking us off topic.
Welcome to the Walmart buyer. In my market a buyer won't give you an extra dime for a quality home over an inferior one built right next door. Your house could be in prime condition and the one next door needs a new roof, furnace, kitchen, etc., but is $5000 less and it gets all the attention.
The 15k tax credit would be a help for the middle market buyers and sellers.
Welcome to the Walmart buyer. In my market a buyer won't give you an extra dime for a quality home over an inferior one built right next door. Your house could be in prime condition and the one next door needs a new roof, furnace, kitchen, etc., but is $5000 less and it gets all the attention.
The 15k tax credit would be a help for the middle market buyers and sellers.
Agreed! The whole notion of having more stuff as opposed to quality stuff is part of what got us into this mess!
Yep, it'll work just like every other attempt by gov't in the history of the world to prop up prices.
The irony is the big loser's are going to be the people taking advantage of this. That credit isn't going to seem very big 10 years from now when the home is still worth less than they paid.
It's amazing that even after all thats happened so few people seem to have learned anything. The notion that you better buy before rates go up is one example. Yeah, better buy now so when those rates go up your underwater on your mortgage. wtf? Doesn't anyone know the relationship between home prices and mortgage rates? Or what the historical level of mortgaga rates is? Or the fact that housing doesn't mimic the stock market but instead moves in long, often muli-decade cycles? Or that creating bubbles doesn't solve problems it makes them worse?
Ah, nevermind. Noone is listening anyway.
I hear you! And I'm the target of the credit if it is passed.... We had to relocate, had to sell our home and we are now renters watching the market. If I had a dime for every realtor that is telling me now is the time to buy.... I'd like to respond with: How many buyers did you also say "Now is the time to buy before prices go up even more..." to in 2005 and 2006?
I'd love to be back in my own home, but buying right now does seem very risky. We are in a fairly stable market and in some ways, that concerns me even more about buying. Rising interest rates could be what changes this market. And $15,000 will not go far to cover losses.
Honestly, this tax credit is an outrageous waste of taxpayer money. This is no different than a car manufacturer offering a rebate on a car they can't sell, except this time the money is coming out of your pocket. Why should I subsidize someone else's purchase?
The only people that are going to take advantage of this are those who were already planning on purchasing a home (regardless of market conditions), and those who are blind to the fact that rising unemployment, record inventories, and higher interest rates are only going to put more downward pressure on already sinking home values. $15,000 (or $8,000) is drop in the bucket compared to the tens of thousands that a home can potentially lose in value as this recession peters out. The short-term gain in no way vindicates the long-term consequences.
Despite what your senator, mortgage broker, or real estate agent may tell you, this is not a good thing. It only inflates our national debt, and will temporarily slow the pace of the historic freefall in property values.
It doesn't look to me that more buyers is going to help-- right now the lenders won't LET the prices go up because we're hitting the assessment ceiling even with a single buyer. Until the prices are ALLOWED to go up given the assessment limits, it looks to me that we're stuck here. The assessments are held low by the huge inventory of REOs. It doesn't look to me that the problem is that buyers don't have enough money. And I'm not interested in an REO which has been either 1) virtually abandoned by the bank and has fallen into disrepair and vandalism which they refuse to fix, or 2) spend months trying to negotiate a short sale where even if I get it I have to evict the disgruntled previous owners or similarly have a run-down abandoned property. I can afford to buy a decent home in a REGULAR sale, IF the lender would actually lend and there were enough of them for me to have a chance at one.
I've TRIED to buy a couple of houses now and BOTH fell out because the seller wanted more and I was willing to pay but the lender was not willing to lend based on the assessment. I'd be HAPPY to pocket the extra tax break if I could actually BUY a house for a price agreed upon by me & the seller-- and I've had competing buyers as well which ought to support the price. If MULTIPLE buyers are willing to bid up the price for a house, what's the point if the first offer is ALREADY more than the assessment? How can the prices EVER go up if buyers aren't allowed by the lenders to pay more than the assessment?
It seems to me the only fix for this is for gov to send a big signal to the lenders & their assessors that they have to relax their assessment ceilings in order to allow prices to rise to what the market will actually bear. And FHA needs to be folded into that as well. But that probably won't happen because it will increase the divide between REOs and non-REOs, which the banks don't want as it allows the toxic assets to drop in value even more-- right now the non-REOs as few as they may be, are shoring up the REO prices a bit and the banks like that effect-- the non-REOs are more often in good shape and sell fast for full appraised value. If not that, then the banks have to reach into their pockets and agree to FIX run down properties IN ADVANCE OF CLOSING and not leave it up to the buyers-- if they won't, then they'll just have to drop the prices futher, as if I'm going to have to buy a messed up REO, things still aren't nearly cheap enough to make this buyer want to go there, anyway, 203K notwithstanding. I'm holding out for MOVE IN READY and have the income to pay for something decent. And I don't have any time pressure so I'll wait if I have to...
On the other hand, I might consider an REO if two things were to happen-- 1) the banks would stop SITTING on properties so I'd have more to choose from and 2) they'd process them faster so they'd be easier to buy. I need to KNOW and QUICKLY that I'll be able to close in a reasonable amount of time, and can plan to get things fixed that need to be fixed, etc. The process is really ugly right now though, and when there's mostly crap to choose from I need a wider selection (even if it is largely crap) because I need to decide what "problems" I'm willing to contend with. Hundreds of foreclosure listings are showing up each week but the shorts & bank owneds are TRICKLING in to the listings. I've been waiting weeks and weeks for something new to look at and there's zilch, just the same old crap that I've already seen and rejected...
The market AIN'T FIXED until REGULAR SELLERS will actually CHOOSE to get back in. Now, the only non-REOs are from sellers who HAVE to sell. The question then is, how long does the market have to keep sliding and the pundits keep telling everyone that it's not going to be a "V", before sellers who would *like* to sell will actually decide to list their homes? It looks like regular sellers are going to have to be dragged kicking and screaming back into the market before things recover, and I don't have any idea how that process is going to pan out...
Last edited by zinc; 06-13-2009 at 06:58 PM..
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And I'm the target of the credit if it is passed.... We had to relocate, had to sell our home and we are now renters watching the market. If I had a dime for every realtor that is telling me now is the time to buy.... I'd like to respond with: How many buyers did you also say "Now is the time to buy before prices go up even more..." to in 2005 and 2006? 
