WASHINGTON, D.C. — Drawing on more than three decades of experience in the real estate industry, U.S. Sen. Johnny Isakson, R-Ga., has introduced legislation to invigorate housing demand and to boost the economy by expanding the first-time homebuyer tax credit passed by Congress earlier year.
“The first-time homebuyer tax credit has made a difference. First-time home buyers used it and the market stabilized, but we don’t have a recession in first-time home buyers. We have a recession in the move-up market,” Isakson said. “One of the biggest problems facing the American people today is an illiquid housing market, a decline in their equity, a decline in their net worth and a depression in the housing market that we are obligated to correct if we possibly can.”
Specifically, Isakson’s legislation would increase the maximum amount of the credit from $8,000 to $15,000 and expand the current tax credit so that it applies to any buyer of any home, not just first-time buyers.
The legislation also would eliminate the income caps of $75,000 for an individual and $150,000 for a couple under the current tax credit so that there is no income limit for eligibility. Finally, the amendment would extend the tax credit for one year from date of enactment and would still allow homebuyers to claim the credit on their 2009 tax return for purchases made in 2010.
“The man who is transferred from Missouri to Georgia can’t sell his house in Missouri, can’t come to Georgia and can’t take the transfer. His employer can’t afford to buy the house and hold it for him because of the proliferation of inventory that is owned,” Isakson said. “Today, in the United States, one in two sales made every day is a short sale or a foreclosure. That is an unhealthy market, and it is continuing to precipitate a downward spiral in values, loss of equity by the American people and a protracted, difficult economic time for our country.”
Isakson immediately picked up a bipartisan group of co-sponsors for his legislation, including Sens. Lamar Alexander, R-Tenn., Jim Bunning, R-Ky., Saxby Chambliss, R-Ga., Chris Dodd, D-Conn., John Ensign, R-Nev., Joe Lieberman, ID-Conn., Lisa Murkowski, R-Alaska, James Risch, R-Idaho, and David Vitter, R-La.
In addition, the National Association of Realtors and the Housing Working Group of Business Roundtable today endorsed Isakson’s efforts to expand the current homebuyer tax credit as part of recommendations to help return stability and growth to the U.S. housing market.
In announcing its endorsement of the expansion of the homebuyer tax credit as well as other recommendations to boost the housing market, Richard A. Smith, President and CEO of Realogy Corporation and Chair of Business Roundtable’s Housing Working Group, said, “We recognize the earlier efforts made by the Administration and Congress, but strongly recommend taking additional steps to jumpstart the lagging housing market in order to stimulate a broader economic recovery.
“If the housing market is not corrected or stabilized, the tide of the recession is not likely to reverse in the near term, and the slide in the economy overall will continue. We believe targeted, demand-side solutions — such as the ones Business Roundtable is recommending — will provide a critical next step for a housing recovery that will help create jobs and boost the economy as a whole.”