Barack Obama pressed to back breaks for home buyers
November 15 2008 - What will it take to get consumers off the sidelines to buy more houses and help stimulate the economy?
How about a mortgage at 2.99 percent fixed rate for 30 years for anyone who purchases a home before next July 1? Or how about a federal tax credit of 10 percent of the home price up to $22,000 that wouldn’t have to be repaid?
Would enticements like these be sufficient to shift you into buying mode? Alternatively, if you preferred a plan that cost the Treasury less, would you go for a mortgage in the 4 to 5 percent range, fixed for 30 years, along with a $7,500 tax credit?
Though these may sound like wish-upon-a-star daydreams, some major housing groups are asking the incoming Obama administration to put hefty homebuying incentives like these at the center of any national economic stimulus plan.
The National Association of Home Builders wants President-elect Barack Obama and the new Congress to use a combination of deep mortgage-interest rate “buydowns” — rate reductions to 2.99 percent or 3.99 percent — plus federal income-tax credits to jolt housing sales and new construction back to life.
The National Association of Realtors, the largest housing lobby with 1.2 million members, also is asking the new administration for mortgage subsidies and tax credits, though not as deep or expensive as those proposed by the builders.