Tue Feb 14 2012
Attached to federal legislation that extends the first-time home buyer tax credit and unemployment benefits is a curious provision. It provides a $6,500 tax credit for home buyers who have lived in their current home at least five years. And this is a good idea because ... ?
Evidently the idea is to stimulate a rebound in home values, which got hammered by the real estate market collapse. Whether the new credit does that or not, it will deliver six months of stimulation for real estate agents and a tax break for people who don't need one.
No question the tax credit will appeal to American homeowners in good financial shape who have been thinking of another home, planning a relocation or just hoping to trade up.
The first-time home buyer credit makes sense. This credit for current homeowners, though, looks like a politically inspired giveaway.
President Obama signed the bill on Friday. Since the bill had more justifiable aid for first-time home buyers and the unemployed, he was not going to veto it. But the $6,500 credit to stimulate more housing sales among upscale homeowners looks like a boon to relatively few people who don't need the help. (Reprinted from Anchorage Daily News, Anchorage, Alaska)
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