Proposal to Extend Homebuyer Tax Credit Offers $6,500 to Repeat Homebuyers

The homebuyer tax credit is said to be guaranteed to pass and in this new round the tax credit is supposed to contain a $6,500 tax credit for repeat homebuyers who have owned their home for more than five years. The first round of the first-time homebuyer tax credit seemed to help the housing market a great deal but opponents of the bill said that it was money being wasted because many who qualified for the bill didn’t need the tax credit and others who needed help had a variety of troubles in buying their home.

Despite, the first-time homebuyer credit having good results there are mixed feelings about the repeat homebuyer tax credit because it seems to have no point in terms of helping the housing market. If someone has owned their home for more than five years and wishes to take advantage of the repeat buyer tax credit then there are rules set in place to stop people who are flipping houses from benefiting from the program. Yet, why would congress fund a plan that essentially helps someone buy another home—which could be a strain on their credit if they have trouble making payments as many Americans have—or simply gives someone money for moving?

There are those who feel the repeat homebuyer tax credit is a good idea seeing as how interest rates are at an all time low. Homeowners who have owned their homes for over the five-year time limit and for a variety of reasons need to move. Perhaps their family is growing or there is a better job waiting in another city or state and moving to a new home would benefit them greatly. Also, the repeat homebuyer tax credit is going to sell houses and that is going to boost the housing market and with the prerequisite of someone having to have owned their home for 5 years before they can take advantage of the tax credit, proponents of the tax credit say they are less likely to default on their mortgage since they have a proven, stable track record with their home.

Again, the extension is said to be a sure thing but what are the different views on the repeat homebuyer tax credit? Is this a good plan for the housing market and economy in general and will the assistance it provides be worth it all or is this just an example of wasteful spending?

Homeowners in the state of North Carolina are still struggling as home prices have yet to bottom.  With no first time home buyer tax credit it is hard for first time buyers to put the money down.  It will be very interesting to see what happens in the years ahead as many are looking for ways to make these down payments a little bit easier.