I am rebloging this to hear from people that disagree with this proposal. I did post this on the blog itself because out of 173 posts I counted only 8 that disagreed.
Here are my comments, let me know if I am off base.
Because this post was featured in the daily email and I thought the Title was interesting, I stopped by to read the post. As I read thru 173 posts I was surprised to only find 8 posts that I felt disagree with the proposal. Make this #9 that disagree. I support the elimination of the 8,000 credit. While at the same time agreeing with some of the posters that if renewed it should be the greater of the downpayment or a fixed maximum amount. With the tightening loan criteria I see the current stimulus as PAYING PEOPLE TO (that can afford to buy) BUY HOMES. Your proposal continues to do just that and in larger amounts.
I ask everyone that supports this proposal if they support higher taxes and if they support this proposal because they would benefit with more income from sales. People need to ask what is the best for everyone not just themselves.
A lot of real estate agents are speaking as if the door on real estate sales will be slammed shut if the federal tax credit for first-time homebuyers is not extended. And while this opportunity to collect cash has had a very positive effect on sales in the lower price ranges, it really hasn't meant much to sellers with homes valued in excess of $200,000.
My preference is to let this credit just go away. The expiration of the credit could actually lead us back to a true fair market, where buyers buy because they need a house rather than just trying snag a great deal with future profit potential.
I would like to propose an alternative remedy to help sale in all price ranges. My proposal would really create interest in buyers that could really stimulate the market, and it is the only remedy that I have even seen proposed that would actually correct the mistakes of the past.
The solution I am proposing is to make all down payment monies for a personal residence up to and including a cash sale an income tax deduction. Not a refundable credit, just a deduction against income.
This also would encourage buyers with both cash and significant incomes to get back into the market. It would lead us back to the days when more down payment was better, and smaller mortgages would prevent the short position debacle that we are experiencing today.
The higher end market would see an extensive boost in sales, and prices would stabilize. And once again, homeowners will be encouraged to have equity in their homes to cushion them against negative market forces.
So what do you think? A dollar for dollar tax deduction for down payments on a house sounds like a good idea to me!
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