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Mortgage News Daily combines the expertise of some of the housing industry's leading minds with the power of social media to offer an always lively, constantly evolving web community. MND communicates breaking news, streams video, and provides expert opinion and commentary to a community of interested market professionals and curious consumers.Homebuyer Tax Credit is Net Positive, But Not the Universal Solution
Following a 98-0 vote in the Senate, the House of Representatives has overwhelmingly agreed to pass legislation extending the home buyer tax credit until April 30, 2009. Next the bill will head to the desk of President Obama to be signed into law.
No one argues the extension of the tax credit has value to the marketplace. But what other immediate steps must be taken --- either by government or industry --- to create a sustained housing recovery?
It is universally expected that interest rates will rise next year when the Fed is expected to stop purchasing MBS next year. How high, how quickly is a matter for debate.
What is not debatable is the negative impact of higher rates and an ever shrinking credit box. The extension of the Homebuyer Tax Credit will serve to soften these blows. However, a sustained recovery in the housing market must have two key components
1) Stable Employment
2) Access to Credit
In the absence of either the single shot tax credit will have limited impact. The tax credit is positive but not a universal solution.
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YOUR MESSAGE HERE
Homebuyer Tax Credit is Net Positive, But Not the Universal Solution
Following a 98-0 vote in the Senate, the House of Representatives has overwhelmingly agreed to pass legislation extending the home buyer tax credit until April 30, 2009. Next the bill will head to the desk of President Obama to be signed into law.
No one argues the extension of the tax credit has value to the marketplace. But what other immediate steps must be taken --- either by government or industry --- to create a sustained housing recovery?
It is universally expected that interest rates will rise next year when the Fed is expected to stop purchasing MBS next year. How high, how quickly is a matter for debate.
What is not debatable is the negative impact of higher rates and an ever shrinking credit box. The extension of the Homebuyer Tax Credit will serve to soften these blows. However, a sustained recovery in the housing market must have two key components
1) Stable Employment
2) Access to Credit
In the absence of either the single shot tax credit will have limited impact. The tax credit is positive but not a universal solution.
If you would like to opt-out of receiving email forwards from this person please click here to remove your email address.