Will the Homebuyer credit be extended?

Senate Democrats are close to compromising on a provision that would extend the first-time homebuyer tax credit, according to Regan Lachapelle, a spokeswoman for Senate Majority Leader Harry Reid, D-Nev.. In fact, the Senate will extend the $8000 tax credit for first-time homebuyers until April 2010, with a separate $6,500 credit for second home purchases. Legislation creating the extension could be included in a bill that will extend unemployment benefits and could go to debate as early as this week, according to numerous media reports. What we don’t yet know are the terms of the extension.

Some reports indicate the extension would run through June 2010 and expanded to include all homebuyers, not just first-time purchasers, and others that would extend the full credit to first-time buyers until April 1, with $2,000 reductions every quarter until it dissolved at the end of 2010. The National Association of Realtors (NAR) and National Association of Home Builders (NAHB), along with the Mortgage Bankers Association (MBA) continue to lobby federal officials to extend the credit. According to the latest Department of Housing and Urban Development (HUD) and Census Bureau data, the rate of new home sales declined 3.6% in September, and some have speculated the impending expiration of the credit is contributing to the decline.

Share and Enjoy: