The Wall Street Journal is reporting that the US Senate has reached a compromise on a revamped version of the First Time Home Buyers Tax Credit. This version, if passed, would extend and expand the current tax credit.
The proposed version would keep the current $8,000 tax credit for first time home buyers while raising income limits to $125,000 for single tax payers and $250,000 for those filing jointly. The current income limits are $75,000 and $150,000 respectively.
The new plan would also extend a tax credit to certain existing homeowners. A new $6,500 tax credit would be available to all home buyers who have been in their existing homes for five consecutive years out of the past eight.
Fully executed sales contracts would have to be completed by April 30, 2010 and closing would have to occur by June 30, 2010.
I guess we’ll find out soon enough if this thing passes, or not. Personally, I’m not sure how I feel about it. It could help some buyers get into homes in the short term, which could be a good thing. I am just concerned that we are stealing buyers from the future in an attempt to boost home sales now.
What happens when we arrive at the future and those people have already made their purchases? The government cannot stimulate housing sales indefinitely. At some point it seems the markets have to be allowed to go through normal cycles and corrections.
In any case, if you these incentives will help you get into a home, it looks like they might just be available for a little while longer.
