Real estate poll results: First-time buyer tax credit
Yikes! Time's a-wasting. The deadline's Nov. 30, and real estate agents have warned that it can easily take more time than you have left to get from contract to closing if you're using an FHA-insured loan.
But that all goes out the window if the credit gets extended, which it might. (There's even talk about upping the amount or expanding it to all buyers.)
Here's what the rest of you poll-takers said:
Bought this year; have gotten or will get the credit. Booyah! (Twenty percent)
Trying to buy in time to get the credit; have a contract but haven't closed yet. (Nineteen percent)
Purposely waiting until the credit expires before buying. (Thirteen percent)
Six percent of you aren't a buyer or seller, 5 percent say you bought this year but don't qualify for the credit, 4 percent are trying to sell and hoping the credit will help, another 4 percent are interested in buying but don't care about the credit, and 1 percent have sold or are selling to a first-time buyer.
Several others wrote in answers. For instance:
"Bought last year with the $7500 credit that has to be repaid. Wish I'd waited!" (The $8,000 credit doesn't have to be repaid unless you move out within three years.)
"Previously bought and would buy and sell if it wasn't first time buyers only!!!!"
"Want to buy with the credit but what's out there for sale is garbage!"
"Bid on shortsale 5 months ago..waiting on bank. Need to close Nov 30!"
Here are your opinions about what should happen to the credit:
Most popular answer: Extend it as is for six months to a year. Forty-six percent of you opted for that choice.
Twenty-three percent of you want to extend it, but increase the amount and/or the eligible buyers.
Twenty-two percent say the credit should expire after Nov. 30 as planned.
Five percent say extend it, but decrease the amount and/or the eligible buyers.
Four percent say the credit should become permanent.
Some of you commented on the twin-polls post to share where you're coming from. For instance, Sarah, who's waiting to close on a house, said the credit isn't a big motivator: "It's a nice bonus to be sure, but in the grand scheme of things isn't really that much money. Not worth trying to score a house within the time frame that you don't like or can't really afford or anything like that, at least from where we stand."
Jason, who just had a contract fall through, said: "Of greater concern to me than the tax credit is the possibility of FHA raising its minimum down-payment."
Chel is trying to get a home, but the credit is making that harder: "Because of the credit, everything we've been interested has been scooped up too fast -- and we're not going to play the bidding war game."
And real estate agent John K. thinks any consideration of the upsides and downsides of the credit ought to include its ripple impact: "After spending $150-200k on a home, and pumping 1-2% of that sale price into the economy via transfer/recordation taxes, you then are going to start to make it 'your own.' Most houses in that price range need some sort of work usually, and even if it's move-in ready, you still want to add your own touches in terms of painting, furniture, etc."
More thoughts?
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Comments
I sell real estate in the Monadnock Region of New Hampshire and my niche consumer happens to be the first time buyer. I have noticed that, for the first time ever, 85-90% of my sales this year have been to first time buyers, whether I was the listing agent or the buyer's agent. The buyers I worked with all felt the crunch to find the right home in time for the credit. Since we have just about met the time when first time buyers needed to get under contract (if they are depending on getting the credit plus getting their loan from FHA/RD/NHHFA) my buyer pool has drastically reduced. I will close on my last tax credit buyer this month and have nothing in the works for November.
While the push from buyers to close in time to get the credit did leave me feeling temporarily normal again (yes, I was spending on clothes, etc.) will I be back to square one again this winter?
Is the ecomony's status being falsified by the incentives and tax credits, rebates, etc. ? Are we going to turn into a JCPenney country where sales and rebates will always be expected? I hope not and truly hope the natural efforts at self correcting the economy (otherwise known as recession) will see true improvements sooner than later. It's hard to see people you know and love being affected and, like the swine flu, you almost don't know who will be laid off or affected next.
Posted by: Stephanie Jacques | October 11, 2009 1:38 PM
Stephanie, the tax credit on homes and the CFC deal for cars are supposed to be a stimulus not (I hope) as some sort of government support of the home and auto sales industries.
A stimulative measure to demonstrate that there are in fact buyers, by that to show a market price and to help clear inventory... but if these markets genuinely need continued support to maintain themselves then all that demonstrates is that there should never have been any of these costly stimulus efforts at all.
And I sincerely hope that the credit is NOT extended. We can't afford it; not even those who would be receiving it.
Posted by: MrRational | October 11, 2009 3:17 PM
I own a title insurance company in South Florida and from what I'm seeing the banks are very slow in getting these files to closing. And Short Sales? THAT'S a whole long topic in itself - 6-8 months for the bank to approve it? CRAZY! Since I've been in the industry for a very long time my clients and friends ask for my thoughts. My standard answer: my crystal ball is broken. It's a whole new world right now. Let's get these banks to work WITH us to help these homeowners. My title company is ready, willing, and able to work - anywhere in Florida - let's get this economy growing!
Posted by: Leslie Mendenhall | October 11, 2009 4:39 PM