Housing Stimulus Bill Becomes a Law!!

You read that headline accurately – yesterday, July 30, President Bush signed the housing stimulus bill into a law. This means great things for the real estate industry, and will hopefully offset the slow market and economy we’ve been experiencing over the past year. If the new law, known as the Housing and Economic Recovery Act of 2008, actually produces the anticipated results, not only with the real estate industry benefit, but the general economy should stabilize along with it.

Possibly the most appealing aspect of The Housing and Economic Recovery Act of 2008 is the temporary tax credit for first-time homebuyers. Providing an extra push for individuals that have been wavering over the decision of whether or not now is the time to invest in homeownership, first-time homebuyers that purchase a house before July 2009 are eligible for a $7,500 tax credit. This should be more than enough motivation to get more buyers in the market, boosting the economy and lowering the number of inventory homes on the market. However, once the supply of inventory homes begins to diminish, prices are going to go up. Right now there are many fantastic homebuyer incentives for you to take advantage of, but once these first-time homebuyers begin depleting the supply, you can say “bye-bye” to these extraordinary deals. So, I do believe it is safe to say there has never been a better time to purchase your first home. For more information about the tax credit, and to get all of your questions answered, please visit the recently launched Web site of the National Association of Home Builders, www.federalhousingtaxcredit.com.

Of course, there is more to the Housing and Economic Recovery Act of 2008 than the tax credit. To help with mortgage rates and foreclosure rates, adjustments have been made to many government programs. The FHA is going to be updated and expanded to offer greater flexibility to better meet the needs of borrowers. The GSE has also changed, reforming the regulations of Fannie Mae and Freddie Mac to permanently increase the conforming loan limit. There is also the introduction of a Mortgage Revenue Bond Program, which gives states the ability to issue addition funds in mortgage revenue bonds, helping out homeowners in need of refinancing their home loans. All in all, the Housing and Economic Recovery Act of 2008 should live up to its name, and the real estate industry should be on its way to clearer skies.