To all the agents in the house,
As the Magnetic Fields declared, "Washington, D.C., It's paradise to me!"
Let's talk about Washington, specifically the proposed homebuyer tax credit. HousingWire and our colleagues at RealTrends have primers about what the Joe Biden administration and Congressional Democrats each proposed.
Basically, if you buy a home after not buying a home in the last three years, and don't buy an expensive home (not more than 110% of the area median home price), there's a $15,000 credit waiting when you file your taxes.
Your guess is as good as mine how the legislation may be amended. But it's a new administration, there's public appetite for federal stimulus programs, and there's a decades-long history of federal policies that help the home-buying market. I'm not Sam Donaldson here, but there's a reasonable chance a credit, or grant, for homebuyers becomes law.
The homebuyer tax credit is supported by the National Association of Realtors. But agents I've talked to are not terribly invested in it becoming law.
"It's just like down payment assistance," said Edward Hru, an eXp real estate agent in Orlando. "The market is going to move with or without it. Buyers are ready to go."
Indeed, as Tracey Velt reports in RealTrends, agents are wary about the tax credit throwing gasoline on to the high-demand, low-inventory fire. "The last thing to do in this market is stimulate demand on the buyer side," said Ron Russell, president of Russell Real Estate Services in Ohio.
On the other hand, we don't know what the market will look when (if) such a credit becomes a law. There are (maybe) encouraging signs for inventory including the highest level of new building permits and construction starts in 15 years.
Agents, what do you think? Is the homebuyer tax credit excessively adding to excessive demand? Or is it a safety net to encouraging new buyers?
Please reply anonymously at mblake@housingwire.com.
Sincerely,
Matthew Blake
Senior Real Estate Reporter
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