Home buyer credit: effective or not?
Since the federal home buyer tax credit was extended and expanded in November, has it (a) been the major driver of the market or (b) had precious little effect?
You'd think experts could agree on this one, but I keep hearing both answers.
The Federal Reserve's March 3 Beige Book, for instance, says most parts of the country "attributed stronger home sales to the home-buyer tax credit, with several contacts apprehensive about future sales once the credit expires on April 30." And many of the Baltimore-area real estate agents I've talked to say lots of their buyers are first-timers eligible for the $8,000 credit.
But a Citigroup analyst following Pulte Homes says the extended credit hasn't done much for the builder's sales, the Associated Press reports. And mortgage giant Fannie Mae says the extension has been more bust than boom because many first-time buyers bought last year, though it does expect a flurry of last-minute purchases.
The Wall Street Journal, reporting on Fannie Mae's credit musings, says the financier considers the $6,500 credit for repeat home buyers a definite flop -- it's not a big enough incentive, "given that current homeowners generally must incur commission costs to sell their current homes, a cost not incurred by first-time home buyers."
I've sure answered a lot of questions from people hoping to qualify for the $6,500 repeat-buyer credit, but I don't recall anyone saying the money was the push they needed to buy. Anyone? Bueller?
Either way, I'm curious what you think of the overall tax-credit program. Is it having an effect?