Extension in Sight for First Time Home Buyers Tax Credit

Recent reports from Reuters indicate that a move is afoot in the U.S. Senate to extend the duration and expand the participation in the first time homebuyers tax-credit. This is big news for the Atlanta real estate market and for new home builders nationwide.

The original bill, which is set to expire at the end of November, provides an $8,000 tax credit to individuals making $75,000 and couples making a combined $150,000 for the purchase of their first home.  Senate Majority leader, Harry Reid, announced yesterday that he has bi-partisan support for an expansion of  the popular program.

The tax credit will extend until the end of April, 2010 and will be expanded to include individuals making $125,000 and couples making $250,000 combined.  The program will also provide a $6500 credit to people who have lived in their home for up to five years if they purchase a new primary residence.

The proposed bill comes as a September spike in home sales showed signs of slowing as potential buyers would not be able to close on a purchase by the November deadline and thus would not be able to take advantage of the original tax credit.

NAHB President Jerry Howard said in a release yesterday, “There is bipartisan support for this action in both chambers of Congress because lawmakers know that the tax credit has already helped to create nearly 200,000 jobs, spur home sales, slow the rate of foreclosures and stabilize home values.

© Atlanta Real Estate Forum 2009