House Speaker Nancy Pelosi, D-California, Thursday hinted that Congress is not only evaluating whether to extend the $8,000 tax credit for first-time home buyers past its November 30 deadline, but also is weighing whether to expand the program.
"There's under consideration whether we extend the first-time homeowners' credit," Pelosi told reporters today in Washington Thursday, Bloomberg News reported. "And the question is, would that be just first-time homeowners or would you open it up to other purchasers of homes?"
The National Association of Realtors is recommending that the $8,000 credit be extended into 2010, arguing that the credit is stimulating a significant amount of home sales.
"The credit is working," NAR Regional Vice President Joseph L. Canfora said, in a statement, noting that the 355,000 to 400,000 transactions directly attributable to the credit made a significant dent in the housing inventory and will help to stabilize home prices. The additional buying activity also has provided an indirect benefit to local governments, bolstering property tax bases.
Housing Analysis: Congress should extend the $8,000 first-time home buyer tax credit through at least July 1, 2010. Even better: extend it through another summer selling season (when many families move, due to school not being in session): September 1, 2010. Ideally, Congress should open the program up to all primary-residence home purchases through July 1, 2010, although Congress may understandably balk at the latter, particularly if the Congressional Budget Office came back with a budget impact statement indicating a universal home buyer tax credit would increase the budget deficit by an unacceptable mount.
Minimally, Congress should extend the $8,000 first-time home buyer credit in tapered mounts: $8,000 for homes purchased before February 1, 2010; $6,000 before April 1, 2010; and $4,000 before July, 1, 2010.
The objective here is obvious enough: maintain and stimulate housing sector activity, amid a U.S. economy that needs all the demand pressure it can get.