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The Biden administration wants to give first time home buyers a $15K credit by turning what was a temporary tax credit to a credit given at the time of the sale. It's estimated that would help toward a 4.3% down payment on a median priced home in the low $300K range.
A money or loan problem is NOT the issue with affordable housing it's a supply issue, a physical building issue not lack of financial incentives, tricks, gimmicks etc.
So a housing bubble already inflated will be inflated more and when things are too over inflated they burst.
I agree with you that our biggest challenge right now is with supply. While we here in the NW are experiencing lots of new people coming in, our county politics and growth management policies are smothering new construction. But that's not a bubble. Rising home prices do to high demand and lack of supply isn't a bubble, that's textbook supply and demand economics.
As for the $15K for first time home buyers, they're my favorite kind of clients, and if it helps them buy a house, that will be good for us this spring.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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I suppose 15k is helpful to buyers in some areas, but here the median home price is now $990k, so a minimal 5% down is $49,500. In addition, most are selling in a day or two with multiple cash offers over asking.
I suppose 15k is helpful to buyers in some areas, but here the median home price is now $990k, so a minimal 5% down is $49,500. In addition, most are selling in a day or two with multiple cash offers over asking.
I seem to recall a time period recently when buyers were able to buy with little or no down payment and with fair to poor credit scores because to require more of them would be considered as "discrimination". That time period was roughly 2004 to 2007. We know how that ended. Looks like we may be about to repeat it... just so that we don't "discriminate" against the disadvantaged.
I seem to recall a time period recently when buyers were able to buy with little or no down payment and with fair to poor credit scores because to require more of them would be considered as "discrimination". That time period was roughly 2004 to 2007. We know how that ended. Looks like we may be about to repeat it... just so that we don't "discriminate" against the disadvantaged.
Yours are true statements about what happened then. That housing crisis *was* solved through much more stringent credit and documentation policies which, as far as I know, are still in place, so I'm not sure it's the same thing.
We also had a $8000 first time home buyer tax credit in 2009 and 2010 which helped our housing market recover from that crash.
I don't know if it's the right answer now for the economy as a whole, but what I think about that doesn't really matter. Those decisions are made above my pay grade. If it can help some of my clients in a tough housing market now, I'll welcome it.
Does it have any impact on people closing on houses in early 2021, assuming the policy becomes official in, say, April? Just wondering if all 2021 buyers to date will be grandfathered into the policy?
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Quote:
Originally Posted by Diana Holbrook
Those aren't first-time home buyers.
We have three new neighbors this past spring and summer, all were first-time buyers, millennials with young kids moving from Seattle apartments, and both paid $750-800k
We have three new neighbors this past spring and summer, all were first-time buyers, millennials with young kids moving from Seattle apartments, and both paid $750-800k
In high cost cities like Boston, DC, Seattle and California, it's very normal for first time buyers to spend $1+ million on a starter house. A dual doctor, dual law couple in their late 20s/30 can do it. Just an example of how distorted the economy is between the high cost regions and everyday America.
I have friends in the Bay area/Socal who spent 1-2 M on their first property and other friends in Philadelphia and Baltimore who spent less than half that and still ended up with a comparable property.
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