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Real Estate Pro Backs Home Tax Credit
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Published: May 31, 2008
NEW PORT RICHEY - With the federal government in the midst of sending out income tax rebate checks, another proposal in the works would offer a $750 tax credit to entice people to buy houses.
Greg Armstrong, president of the West Pasco Board of Realtors, recently spent a week in Washington, D.C., with a delegation lobbying for various bills such as the $750 credit to home buyers.
The legislation could come up for a vote in Congress by next week, Armstrong hopes. President Bush has said he would sign the legislation to help boost the sagging real estate market, Armstrong said. If all goes well, the tax credit on home purchases could go into effect by July 1, he thinks.
Armstrong rates the tax credit as the best tool available now to the federal government to prop up slumping home sales.
State property tax law changes such as Amendment No. 1, which Florida voters passed Jan. 29, have spurred some interest among home buyers, Armstrong observed.
Nevertheless, "It's still just a trickle," Armstrong said about home sales. "People are calling. People are looking."
The $750 tax credit could help persuade them to buy, he believes.
In addition, builders likely would benefit if sales pick up, Armstrong said.
The government might be the best hope to stimulate the home market, in Armstrong's estimation. Banks don't have a lot of money to lend right now, he said.
Nobody is buying mortgage-back bonds, which means Fannie Mae and Freddie Mac, the nation's top two purchasers of mortgages, have been "stagnant," according to Armstrong. When Fannie Mae and Freddie Mac buy mortgages they make available money for other home loans.
As a result, one of the few options right now, he said, is loans through the Federal Housing Administration.
Originally, the federal legislation would have offered the tax credit to people who buy a home in foreclosure proceedings, Armstrong said. Lawmakers "would have made the problem worse, not better," had they not revised the proposal to remove that requirement, he said.
If not, buyers would have waited until homeowners went into default on home loan payments, Armstrong said.
Carl Orth can be reached at 727-815-1068 or corth@suncoastnews.com .
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