Senate Democrats say they will extend the first-time home buyer tax credit ahead of the program’s Nov. 30 expiration.
Learn more about the first-time home buyer tax credit.
A Reuters report says a vote on the measure could happen as soon as Tuesday evening. However, Republicans say that negotiations are still taking place.
The tax credit provides up to $8,000 to homebuyers and has been wildly popular. As its expiration on Nov. 30 nears, consumers and the real estate industry both are clamoring for an extension.
The program has been credited for the recent rise in home prices in most major cities over the last 3-4 months. But the tax credit is not without critics, who say its cost outweighs the net benefit. Economics blog Calculated Risk estimates that for each home sold under the program taxpayers spend $43,000. And Congress estimates that an extension of the program would cost $1 billion per month.
Housing industry’s growing momentum is a stark contrast to employment, which has remained weak. Further stimulus in the housing sector likely will do little for job creation, adding to skepticism that such a program is helping America climb out of the economic slump.
Source: banks.com.
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