Senate OKs $15,000 tax break for homebuyers

[babsbunny]

http://news.yahoo.com/s/ap/congress_stimulus

WASHINGTON – The Senate voted Wednesday night to give a tax break of up to $15,000 to homebuyers in hopes of revitalizing the housing industry, a victory for Republicans eager to leave their mark on a mammoth economic stimulus bill at the heart of President Barack Obama's recovery plan.

The tax break was adopted without dissent, and came on a day in which Obama pushed back pointedly against Republican critics of the legislation even as he reached across party lines to consider scaling back spending.

[Oregone]

1. This seems fuckn lame

The only people really looking to buy are already rich. Everyone else is cash-strapped and tapped out. This is just tax payer funded action leading to wealth disparity.

[KansDem]

11. I agree...giveaway to the GOP's base.

I'm a month behind on my mortgage. I pay regularly now, just for the month before. I need to make a double payment to catch up, otherwise I keep getting hit with late charges that add more to what I owe. I'm not looking to buy a house...just keep the one I have.

[rvablue]

23. I thought the same thing .... actually, yelled it outloud, when I heard this on the radio today

how can someone without a job or not enough money to pay the mortgage, buy a house?

[Xithras]

43. Nope, you're wrong on that. Low end home sales are climbing in some areas

I just listed two investment properties for sale. Across several parts of the country (including the Northern SJ Valley in California, one of the worst hit areas in the nation for foreclosures) the entry level home market is humming right now. Lots of people who HAD savings but didn't have the income to buy into the previously skyrocketing market are taking advantage of the crash. Homes that were out of reach when they were selling for $400,000 are now selling for $150,000 (yes, our market has dropped THAT far). Decent credit and $15,000 in the bank will get them a loan. It's the one plus in an otherwise grim market.

I can't comment on the national situation, but my realtor is selling several houses a week now, and was lucky to sell one a month just a year ago. Since one of my homes is an entry level (1500sf 4br single story ranch on .12 in a 15 year old subdivision listed for $149,000), we're predicting offers by the end of next week.

The market for larger homes and McMansions is still dead around here though. The 3000sf stucco monsters behind their fenced community walls are still sitting there empty. New home construction is completely nonexistent.

[Oregone]

49. Are you sure you aren't just referring to forclosure sales

As far as I was aware, that was the only thing moving at a decent rate. Fire sales of all these banks' useless homes that cost them money.

[Xithras]

52. Foreclosure sales, short sales, cheap sales...starter homes are moving well at the moment.

A decent chunk of the buyers are investors looking to pick up rental properties, but the overwhelming majority are first time buyers who were simply priced out of the market before. We're seeing a huge wave of blue collar, ag, and hispanic buyers who didn't have even the slightest chance at home ownership just a few years ago. Our local unemployment rate is about 13% because of the laid off construction workers, but the other industries revolving around our ag base are largely unscathed by the economic crash right now. People need food, and the people who work in the companies making food have fairly secure jobs.

Many of these people are seeing this as the buying opportunity of a lifetime and sales of the lower-end homes have been accelerating in this area for quite a few months now because of it. A person buying a 20 year old 3 bedroom home for $135,000 (a home that would have sold for $350k+ a couple years ago) only need to bring about $15k to the table to buy that house today. If they have the cash, a good job, and decent credit, getting that home will NOT be that hard.

This is a market-by-market thing, but not all real estate is dead everywhere. In my own area, this $15k credit will be a huge bonus to those who can use it the most.

In markets like the northern SJV, there's another thing to consider. A starter home built in the mid 90's would have sold for $75k-$100k new at the time, and would have reached well over $400k in value at the markets peak. Even following the crash, that property would still be valued in the mid-$100's today. There are many people selling starter homes they purchased 15 years ago who are still making tidy profits on the sales. Many of those people are selling those homes today to take that profit and "buy up" while nicer homes are down, or "buy out" and get out of the area before prices decline further. Those sales are also going to first-time buyers, for the most part.

[Maru Kitteh]

55. Most likely landlords and slumlords gobbling up the good deals while they can.

seriously doubt if the majority are going to first-timers.

[bunnies]

2. Can someone please explain to me exactly what this means?

In a real world example? I suck at taxes and economics.

[Oak2004]

8. It means rich people get a discount on their houses

The rest of us, well, we don't really count.

[Oregone]

15. It means those waiting for a government REFI plan are SOL

And it probably wont come up again. The right-wingers can just scream that theyve already spent billions the housing market with this crap.

FUCK BIPARTISANSHIP

[screembloodymurder]

18. Actually, it means rich people get a break on our houses ...

we'll be forced to sell in foreclosure.

[Muttocracy]

30. maybe - at least I think it's restricted to one primary residence. nt

[GregD]

57. qualified principal residence

Thanks for posting the text of the law.

Clearly, this is not just a handout to rich folks - it doesn't really help investors, it is targeted at people wanting to buy a home that they are going to live in. It specifically refers to the home being the purchaser's primary residence.

[Muttocracy]

58. It's hard to imagine $15,000 making a difference to the truly wealthy. nt

[GregD]

59. Well, a tax credit is a tax credit

And I don't see any limits on the value of the purchase - just the cap on the credit. So this has the potential of stimulating sales at both lower and higher levels of the market.

There is also the issue of how to use up an entire $15k credit. Since it's a credit and not just a deduction, that's a lot of tax to sweep away. OTOH, nuking your entire tax liability give you some leftover money for mortgage payments and home improvement costs.

[screembloodymurder]

89. Maybe so, "rich" is a relative thing.

This item will transfer wealth in the wrong direction. Those that can take advantage of it will get a better deal.

[cottonseed]

75. Would a rich person want to live in your house?

Because the bill appears to be only for primary residences.

[Fire_Medic_Dave]

29. Hopefully it will help some people start buying houses again.

That is something that's desperately needed.

David

[Muttocracy]

42. I posted the text of the amendment downthread - not hard to read

except I'm not totally clear whether you get 10% of the home price (max $15,000) off your taxes? Or up to $15,000 off your taxable income? That would be huge for me either way! I might actually be able to buy a house!

[GregD]

54. It is a tax credit, meaning a dollar-for-dollar reduction of tax

From the story:
The proposal would allow a tax credit of 10 percent of the value of new or existing residences, up to a $15,000 limit. Current law provides for a $7,500 tax break but only for first-time homebuyers.

So if the property costs $150,000, the buyer gets a $15,000 tax reduction. The next question which the story doesn't go into is if that's a reduction against ordinary income or if it could be applied against capital gains.

Either way that's a hell of an incentive but there are other issues. Individuals are now restricted to no more than 4 financed properties. That is a new rule effective Jan 1 passed down from Fannie Mae and Freddie Mac. So anyone who is a real estate investor that wants to take advantage of this, unless they have a bucket of cash to buy a property, they are hosed.

I don't see where this helps the average investor unless they only have a few properties, or have cash to jump on the low prices in the market.

[bunnies]

61. So... for people who dont have much taxable income as it is...

it really doesnt do a whole lot. Bummer. Thanks for the info. :hi:

[GregD]

67. that may not be the case

It depends on the fine print, and how the tax credit might be "rolled over" to future tax periods. I'm not a tax accountant, but I do invest in real estate, and this might be handled in such a manner that it could be applied to future years until fully consumed.

[county worker]

3. The problem with this is that only the well off with good credit scores will take advantage.

And in a period where house prices are depressed. I've had a house on the market for over 2 years and the value has dropped close to $200,000K. Some buyer may come along and offer me less than I owe and if I sell I'm screwed and they get a $15,000 tax credit to boot! I'm not selling at a loss!

[Fire_Medic_Dave]

9. Where do you live?

[county worker]

16. The house is east of Bakersfield, CA. I rent it to someone now.

I don't live there anymore.

[cottonseed]

76. So you want this tax credit and more?

To get the housing market pumped again?

That's fine. I just want to be clear. It's interesting reading all the responses on this thread.

[Thrill]

4. You knew the Republicans would slop this up like Pigs

These guys are hypocrites. Its okay to spend as long as the rich can get richer. They're the only ones who can buy houses right now

[MadHound]

5. More borrowed money that's going to be pissed down the drain

Meanwhile our economy is going to continue to go under.

Fuck this bipartisan, post partisan bullshit. The point of having a majority is that you get to impose your will. The American people gave the Democrats all this power, these large majorities because they were rejecting the 'Pug so called solutions. Thus the Dems need to stop worrying about the 'Pugs and simply go ahead and do what's right.

[Earth_First]

6. Anyone know if there is any retroactive clause within this tax break?

?

[Muttocracy]

31. after 12/31/08 - here is full text:

http://thomas.loc.gov/cgi-bin/query/F?r111:1:./temp/~r111mKZnqG:e0:

SA 106. Mr. ISAKSON (for himself and Mr. LIEBERMAN) submitted an amendment intended to be proposed to amendment SA 98 proposed by Mr. INOUYE (for himself and Mr. BAUCUS) to the bill H.R. 1, making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and
local fiscal stabilization, for fiscal year ending September 30, 2009, and for other purposes; which was ordered to lie on the table; as follows:

Strike section 1006 of title I of Division B and insert the following:

SEC. 1006. CREDIT FOR CERTAIN HOME PURCHASES.

(a) Allowance of Credit.--Subpart A of part IV of subchapter A of chapter 1 is amended by inserting after section 25D the following new section:

``SEC. 25E. CREDIT FOR CERTAIN HOME PURCHASES.

``(a) Allowance of Credit.--

``(1) IN GENERAL.--In the case of an individual who is a purchaser of a qualified principal residence during the taxable year, there shall be allowed as a credit against the tax imposed by this chapter an amount equal to 10 percent of the purchase price of the residence.

``(2) DOLLAR LIMITATION.--The amount of the credit allowed under paragraph (1) shall not exceed $15,000.

``(3) ALLOCATION OF CREDIT AMOUNT.--At the election of the taxpayer, the amount of the credit allowed under paragraph (1) (after application of paragraph (2)) may be equally divided among the 2 taxable years beginning with the taxable year in which the purchase of the qualified principal residence is made.

``(b) Limitations.--

``(1) DATE OF PURCHASE.--The credit allowed under subsection (a) shall be allowed only with respect to purchases made--

``(A) after December 31, 2008, and

``(B) before January 1, 2010.

``(2) LIMITATION BASED ON AMOUNT OF TAX.--In the case of a taxable year to which section 26(a)(2) does not apply, the credit allowed under subsection (a) for any taxable year shall not exceed the excess of--

``(A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over

``(B) the sum of the credits allowable under this subpart (other than this section) for the taxable year.

``(3) ONE-TIME ONLY.--

``(A) IN GENERAL.--If a credit is allowed under this section in the case of any individual (and such individual's spouse, if married) with respect to the purchase of any qualified principal residence, no credit shall be allowed under this section in any taxable year with respect to the purchase of any other qualified principal residence by such individual or a spouse of such individual.

``(B) JOINT PURCHASE.--In the case of a purchase of a qualified principal residence by 2 or more unmarried individuals or by 2 married individuals filing separately, no credit shall be allowed under this section if a credit under this section has been allowed to any of such individuals in any taxable year with respect to the purchase of any other qualified principal residence.

``(c) Qualified Principal Residence.--For purposes of this section, the term `qualified principal residence' means a single-family residence that is purchased to be the principal residence of the purchaser.

``(d) Denial of Double Benefit.--No credit shall be allowed under this section for any purchase for which a credit is allowed under section 36 or section 1400C.

``(e) Special Rules.--

``(1) JOINT PURCHASE.--

``(A) MARRIED INDIVIDUALS FILING SEPARATELY.--In the case of 2 married individuals filing separately, subsection (a) shall be applied to each such individual by substituting `$7,500' for `$15,000' in subsection (a)(1).

``(B) UNMARRIED INDIVIDUALS.--If 2 or more individuals who are not married purchase a qualified principal residence, the amount of the credit allowed under subsection (a) shall be allocated among such individuals in such manner as the Secretary may prescribe, except that the total amount of the credits allowed to all such individuals shall not exceed $15,000.

``(2) PURCHASE.--In defining the purchase of a qualified principal residence, rules similar to the rules of paragraphs (2) and (3) of section 1400C(e) (as in effect on the date of the enactment of this section) shall apply.

``(3) REPORTING REQUIREMENT.--Rules similar to the rules of section 1400C(f) (as so in effect) shall apply.

``(f) Recapture of Credit in the Case of Certain Dispositions.--

``(1) IN GENERAL.--In the event that a taxpayer--

``(A) disposes of the principal residence with respect to which a credit was allowed under subsection (a), or

``(B) fails to occupy such residence as the taxpayer's principal residence,

at any time within 24 months after the date on which the taxpayer purchased such residence, then the tax imposed by this chapter for the taxable year during which such disposition occurred or in which the taxpayer failed to occupy the residence as a principal residence shall be increased by the amount of such credit.

``(2) EXCEPTIONS.--

``(A) DEATH OF TAXPAYER.--Paragraph (1) shall not apply to any taxable year ending after the date of the taxpayer's death.

``(B) INVOLUNTARY CONVERSION.--Paragraph (1) shall not apply in the case of a residence which is compulsorily or involuntarily converted (within the meaning of section 1033(a)) if the taxpayer acquires a new principal residence within the 2-year period beginning on the date of the disposition or cessation referred to in such paragraph. Paragraph (1) shall apply to such new principal residence during the remainder of the 24-month period described in such paragraph as if such new principal residence were the converted residence.

``(C) TRANSFERS BETWEEN SPOUSES OR INCIDENT TO DIVORCE.--In the case of a transfer of a residence to which section 1041(a) applies--

``(i) paragraph (1) shall not apply to such transfer, and

``(ii) in the case of taxable years ending after such transfer, paragraph (1) shall apply to the transferee in the same manner as if such transferee were the transferor (and shall not apply to the transferor).

``(D) RELOCATION OF MEMBERS OF THE ARMED FORCES.--Paragraph (1) shall not apply in the case of a member of the Armed Forces of the United States on active duty who moves pursuant to a military order and incident to a permanent change of station.

``(3) JOINT RETURNS.--In the case of a credit allowed under subsection (a) with respect to a joint return, half of such credit shall be treated as having been allowed to each individual filing such return for purposes of this subsection.

``(4) RETURN REQUIREMENT.--If the tax imposed by this chapter for the taxable year is increased under this subsection, the taxpayer shall, notwithstanding section 6012, be required to file a return with respect to the taxes imposed under this subtitle.

``(g) Basis Adjustment.--For purposes of this subtitle, if a credit is allowed under this section with respect to the purchase of any residence, the basis of such residence shall be reduced by the amount of the credit so allowed.

``(h) Election to Treat Purchase in Prior Year.--In the case of a purchase of a principal residence during the period described in subsection (b)(1), a taxpayer may elect to treat such purchase as made on December 31, 2008, for purposes of this section.''.

(b) Clerical Amendment.--The table of sections for subpart A of part IV of subchapter A of chapter 1 is amended by inserting after the item relating to section 25D the following new item:

``Sec..25E..Credit for certain home purchases.''.

(c) Sunset of Current First-Time Homebuyer Credit.--

(1) IN GENERAL.--Subsection (h) of section 36 is amended by striking ``July 1, 2009'' and inserting ``the date of the enactment of the American Recovery and Reinvestment Tax Act of 2009''.

(2) ELECTION TO TREAT PURCHASE IN PRIOR YEAR.--Subsection (g) of section 36 is amended by striking ``July 1, 2009'' and inserting ``the date of the enactment of the American Recovery and Reinvestment Tax Act of 2009''.

(d) Effective Date.--The amendments made by this section shall apply to taxable years beginning after December 31, 2008.

[Extend a Hand]

53. f*ing figures, I bought a house on dec 30.

:grr:

[terisan]

7. Introduced by Rich Realtor, Sen Johnny Isakson-to help rich buy up foreclosed homes

[screembloodymurder]

19. 100% correct.

I'm now against the stimulus.

[Zywiec]

40. Are you going to call your senators and representatives

and ask them to vote no on this bill based on this one item?

[screembloodymurder]

87. Already did.

But I asked that they remove this item from the bill.

[OPERATIONMINDCRIME]

64. 100% Knee Jerk Reaction Without Even Beginning To Understand The Credit.

:dunce:

[cottonseed]

70. You're kidding right?

This is one piece of a large multi-faceted bill. It helps people and this provision will help some families who just may not be capitalist pigs.

[screembloodymurder]

90. Why would you assume this was the first straw?

The progressive portions of the bill have been eviscerated.

[rvablue]

25. Yup. Is there any stipulation in the bill that it can only be used once

or is this something the rich can use to buy investment properties and become slum lords?

[Muttocracy]

34. now that I'm reading the text, sounds like it's for primary residence only. nt

[Tashca]

51. Your right...only primary residence.

skimming through it....there appears to be provisions to keep flippers out too.
Also provisions to only allow one break per house hold....so if two or more adults unmarried live together it still only totals 15K max.
This is maxed out on purchases up to 150K.
Looks to only be available for this coming year.....

[terisan]

35. Hadn't thought of it covering multiple purchases...but it sounds plausible nt

[terisan]

44. Restricted to 1st time homeowner-10% tax credit over 3 yrs for up to $150,000 home

[Lex]

80. No, it's a *one time* allowed credit for *principal residence only.*

nt

[SmileyRose]

10. McConnell just proved once again he's a moran

From the link

"This bill needs to be cut down," Republican Mitch McConnell of Kentucky said on the Senate floor. He cited $524 million for a State Department program that he said envisions creating 388 jobs. "That comes to $1.35 million per job," he added."

Isn't the funding to build a security training facility and upgrade IT equipment? This is something they were asking Bush for wasn't it? McConnell acts like people are either going to be grossly overpaid or else it's a huge slush fund. The guy's a moran.

[Winterblues]

12. How does buying a home provide jobs and a boost for the economy?

Republican Logic is just not logical..

[4lbs]

39. The same reason(s) that buying cars help auto workers.

n/t

[Muttocracy]

41. construction sector has lost lots of jobs; increases values of neighbors' homes

[Horse with no Name]

46. This has the same logic as invading Iraq after 911

The houses were in a bubble. The builders went nutso on building more and more and more.
There is a huge glut of homes on the market that can't sell. Why do we need MORE houses built?
What we NEED is for the existing houses to be re-appraised and reset at CURRENT market value.
Giving $15k in tax credits does NOTHING to help the people who are in trouble. It is helping the people who ARE NOT. The people who ALREADY have jobs and disposable income, not the ones who don't.

[Muttocracy]

50. It doesn't have to be new construction; better to sell than foreclose.

could be remodeling/repair of existing homes.

And there are some places where the drop in home purchasing and high foreclosure rates is hurting people who did everything right for years but need to sell their homes as they retire or move, but their home value has dropped because of their neighbors.

It's not directly helping those in foreclosure, you're right, but it would be an economic activity stimulus and might help them indirectly (e.g., if they won't be upside down or completely unable to sell their homes). Maybe I'm just viewing it from my personal perspective, where it could make the difference in no longer enriching landlords and investing in my own future instead. A few thousand dollars would make the difference for me.

[Kittycat]

13. This does nothing to help those struggling to pay their mortgages.

[screembloodymurder]

20. No, but it does help the banks get rid of those forclosures.

We need to be in the streets! The rich are robbing the poor. Let them pay with their blood.

[cottonseed]

72. How do you plan on blooding up?

Jen and Sally the first time home buyers?

[Zing Zing Zingbah]

14. I suppose this is only for people who buy homes this year.

It would be nice if this would help out people that already have home loans. We got our house a little over a year ago. We still have close to 29 years to go before it our loan is paid off.

[MadHound]

17. Hmm, tie this with the fact that there are Chinese over here shopping for real estate

Looks like we're going to be giving not just more tax money to the Chinese, but lots of discount real estate.

[rvablue]

26. It's a tax break, so don't see how Chinese nationals could benefit from it. n/t

[cottonseed]

65. How does this help foreign investors in real estate?

It's a tax break.

[county worker]

21. Here is a real housing plan that helps.

Take people who can't pay their mortgage. Change their loan into a lease option with no time period. make the lease payments affordable. When the economy gets better change the lease option into a mortgage again with reasonable interest rates and affordable payments. The lenders will not have an empty house on their hands, the borrower stays in the house. The lender makes extra money off the lease payments.

[natrat]

22. like a bad dream coming true-our whore democratic politicians selling out

values across the board crash and the government uses our money to help the rich buy average people's houses for nothing

"like i told ya, like i said ,steal your face right off your head"

[GoesTo11]

24. This is stupid. Stimulus shouldn't be a lottery.

Why should homeowners and renters pay taxes for this lucky crew?

[Horse with no Name]

27. Oh great

Give the republican slumlords a tax break when they start buying up all of the distressed property.
This is fucking great.

[Muttocracy]

28. actually now that I'm reading the text, it's for primary residences. nt

[Horse with no Name]

37. Any loopholes?

There usually are.
I'll believe that there won't be when I read the final version.

[Muttocracy]

38. I posted it in reply 31 upthread - haven't gotten throught it all yet. nt

[Still Sensible]

32. Are we so into raw class warfare here that

this provision, which will no doubt benefit some more than others, is damned? This is a goddamn stimulus bill and this particular provision will stimulate. If it is not limited to existing homes, it will generate some jobs as well.

[Muttocracy]

36. I'm agreeing with you now that I'm reading it - it's for primary residences

and not just any developer and it extends the current homebuyer help.

[BlooInBloo]

47. It's "If I Don't Get Helped Then NO ONE Should Get Helped"-ism.

[cottonseed]

66. Class warfare plus not bothering to even read and understand the bill

equals many angry replies on DU.

[droidamus2]

33. Getting tired

This may be a little whining or a big rant but I am getting real tired of all the housing 'solutions' that help those that have screwed up on their mortgages (yes I know a lot of those are not at fault predatory lending etc) and now help those that want a new mortgages. My problem is here I am trying to get along and do the right thing having to dip into my savings and retirement funds to make my mortgage payments (I paid 50% down before you make a big deal about getting into a bad mortgage) on time. I had a good job lined up but it took over 5 months and counting to get a security clearance and in the meantime the company decided not to fill the position. So if I can't get a decent job in the near future I will be in a bad way but nobody is offering me any help. I will have to be close to bankruptcy before they will even think of helping me. Have all my financial decisions been great, No. Could I have kept better control of my use of credit, absolutely. All I want to do is get a decent job and pay off my debts but in this economy that may be very difficult. How about some help with the existing mortgages (lower rates, extended payments, consolidations). Of course with no job at the moment even those will be hard to qualify for. How about getting the credit card companies under control so people that have over extended themselves can actually have a chance of paying off their debts in this lifetime. Well enough for feeling sorry for myself and people in my position I guess I'll just have to go out and find that good job and do my best to get into a better position financially.

[ecstatic]

45. There are many foreclosed homes in my subdivision going for up to 50k less than

the appraised value of 3 years ago. This is very frustrating. When will I get my bailout? I am stuck here and can't move unless I take up the role of landlord. Of course, I probably wouldn't be approved for a second mortgage on top of the one I already have. I agree this plan stinks and will only benefit the well off.

[CLANG]

48. But what if you are already POOR in your OWN HOME?

Where's my tax break!:puke:

[earth mom]

56. I agree-we should all get a $15K tax break. nt

[SammyWinstonJack]

62. You get NOTHING AND LIKE IT!

Sound familiar?

[RiverStone]

71. I called Country Wide Mortgage yesterday and ask that question

They carry my mortgage - they are also owned by Bank of America which got a big piece of the huge bailout.

Why don't I, a hard working home owner who has managed to keep up with my payments get a piece of that money that YOU and I gave them to save their sorry ass from bankruptcy. Where is my share? Or how about shave a 1/2 point of my interest? Anything!

The dude on the end of the line simply said: I have been getting tons of calls with the same question, all I can say is I have no idea who is getting that money - but it won't be you or I.

[KillCapitalism]

60. It's not only for the rich.

My wife and I will be purchasing a home this year & will be taking advantage of this tax break. We are FAR from rich however. We've been living in her parent's home for the past four years trying to scrimp & save for a home & we've kind of worn out our welcome I suppose.

I'm not sure if it will help stimulate the housing market though, and to be honest, I'd rather have an incentive such as a guaranteed 2% interest rate on a 30-yr. conventional mortgage than receive the $15K tax incentive.

[OPERATIONMINDCRIME]

63. Why Are So Many Knee Jerk Bitching About This? It's Not A Bad Addition At All.

Adding any momentum to the housing market will have a positive impact on the economy. This won't be something that's a be all end all, but every little bit helps.

[cottonseed]

68. I dont' think a lot of replies on this OP are a result of actually understanding the bill.

Most surely haven't even read it. Knee jerk indeed.

[GregD]

69. I tend to agree. I don't see anything wrong with it.

Get the freaking real estate market going again and you solve a big problem. The language of this very clearly presents it NOT as a boondoggle. It helps people buy a home they are going to LIVE IN.

[cottonseed]

73. I agree, and I don't see this as re-inflating the bubble either.

Prices in some areas are getting back to a natural trend line which I would expect to be about the time to start looking at buying. I purposefully stayed out the market over the last 5 years because of the sky-rocketing prices. Now that we're approaching a reasonable price level I sure as hell don't want to be called a free market pig because I see value in this portion of the stimulus.

[hfojvt]

82. it helps wealthy people buy a home they are gonna live in

What about the 60% or so who already own their homes?

[hfojvt]

77. right, so if rich people get a break it trickles down to all of us

Is that what you are saying? How stupid are we not to understand that? I suppose we shouldn't be "knee jerk" against making the Bush tax cuts permanent or eliminating the AMT either?

[OPERATIONMINDCRIME]

78. ...

:eyes:

[KatyMan]

79. We're not rich

and we're buying a new build house, and this tax break will be very welcome. And it's only on the first 150k of the house value if it's your primary residence--how does that only benefit rich people? Our house price is 154k. Are we rich? Why didn't somebody tell us?

[hfojvt]

81. What's your household income?

I don't know if you are rich or not, also the $150,000 house value does not make sense. It's a $15,000 tax credit. Pulling out my handy tax table for 2008, I find that you need to make more than $74,000 as a single person to have $15,000 in taxes. A married couple needs to make over $88,600 and a married couple with one child over $92,600.

Bottom line is that a tax credit, particularly a huge tax credit does not benefit couples making under $40,000 because they already don't pay taxes. So the benefits to this are for families making $60,000 - $200,000. Well above the median income. I sure didn't get any tax credit when I paid $35,000 for my 115 year old house and I won't get any tax credit when I have to fix its 80 year old sewer line either.

I am sure you welcomed some parts of the Bush tax cuts too. Never mind the huge amounts going to much richer people.

[KatyMan]

84. Well

First of all, we lived out of the country for the bulk of the Bush years, so I really don't know if the tax cuts would have affected us at all. That was actually a pretty shitty comment.

Our combined income is about 110k, as my wife and I are both professionals (nursing and IT), and are happy to pay our fair share of taxes, and also happy to take advantage of any tax breaks that might come our way. We're frugal, not buying a Mcmansion, own only 1 car, and have only 1 debt (the car). We save our money, live in a 700 sq ft apartment right now, have a tiny tv, only eat out on special occasions, so we live within our means, and were able to save.

What does 'the $150,000 house value does not make sense' mean? We live in the Houston area where housing has always been very reasonable, and our $150k house is a very nice 3 bedroom 1600sq ft house. Why is it wrong for us to buy it?

[hfojvt]

86. I am pleased to inform you

that you are rich. You make more than 85% of the rest of American households. You are not super rich, and Houston is probably pretty expensive, especially the nicer areas of Houston, but at twice the national median income, I would call that rich.

The Bush tax cuts are still in effect, so you are saving a fair amout of money because of them.

[northernlights]

74. THIS IS A GOOD THING!!!! It means I may be able to sell my house!!!!!

There are still some buyers out there...not only rich people. A fellow student at University of Maine just closed on his first home last month.

I've been long term unemployed since I lost my last high tech job 7 years ago. I've had 1 crap job since then, where they poisoned me, harrassed me in my home and ultimately trespassed and assaulted my animals. At which point I quit.

I need to sell my house this spring. MUST. My life savings has just about run out. UME lied to me when I started studying for MLT and as a result it's going to take a year longer and cost 3 times what I originally expected and budgeted for. The salary at the back end doesn't justify the size student loan I'll be forced to take if I don't sell my house.

This way I can downsize my location, pay off my student loans, possibly finish the program for cash and start fresh.

[Rebubula]

83. As someone...

...that is in the process of buying a house...I have no problem with this...

Of course, it may end up hurting other people...so I would have a problem with that. We shall see.

[renate]

85. this doesn't solve the problem of people who can't pay their mortgages, true

No single idea is going to help everyone.

But this would help people who are waiting for the right moment to take a risk and buy a house, like the 20-year-old mechanic who fixed our car and has a brand-new baby and by no stretch of the imagination is rich. It'll help the person who sells him the house that he wouldn't have bought otherwise. And it'll help the manufacturers of the appliances and furniture he'll need to buy.

It seems like anything that helps anybody is a good thing. I don't really care whether a tax credit benefits me personally as long as it helps somebody somewhere. With Obama and the Democrats in charge it would surprise me if Congress says "There. Fixed the housing problem" and doesn't do anything more for people who are already in homes and are hurting.

[Tierra_y_Libertad]

88. Buy!! Spend!! For Sale Cheap!! Isn't that what got us into this mess?

The P.T. Barnum school of economics is running things.