HUD Secretary: Who’s up for another homebuyer tax credit?
posted at 9:30 am on August 30, 2010 by Ed Morrissey
What does an administration do when their gimmicky, taxpayer-subsidized economic interventions — they’re too ad hoc to be called policies at this point — run out of steam and show no sign of solving the underlying problems of the economy? When they have no Plan B, they offer a repeat of Plan A, and in this case, a re-repeat. HUD Secretary Shaun Donovan told CNN yesterday that the White House may back a third homebuyer tax credit in response to the lack of demand in the housing markets:
Shaun Donovan, Secretary of Housing and Urban Development, said Sunday that the housing market’s July woes were “worse than expected” and that the administration may support a new homebuyer tax credit.
In an interview on CNN, Donovan said the administration is “concerned” about the path of the industry. He defended the Obama administration’s record on supporting the housing market, amid new signs that the market is struggling alongside the broader economy.
Donovan did not rule out a further homebuyer tax credit to support the market. Congress passed a homebuyer tax credit to support first-time buyers. The credit has now expired.
“I think it’s too early to say after one month of numbers whether the tax credit will be revived or not,” Donovan said.
Too early? It’s too late to get anyone to believe in it, especially after this summer’s crash. The dive in sales and demand make this a buyer’s market, at least for homes with rational pricing. Another tax credit is unlikely to result in much demand anyway; housing sales are below last year’s figures for a reason.
The problems in the market have nothing to do with the expiration of tax credits, which only moved up purchases by already-qualified buyers that would have come in future quarters anyway. The markets have two problems: irrational pricing, a leftover from the bubble collapse, and unemployment. The housing bubble collapsed in 2008, but thanks to gimmicky interventions like the homebuyer tax credit, values haven’t yet reached their rational level. Further interventions will only further delay the inevitable.
What will solve that problem will be the entry of more buyers into the market — and that’s not going to happen until we start creating a lot more jobs. Even if prices hit a rational level, owners still need qualified borrowers to buy them. Until we start creating jobs, we won’t generate new and qualified buyers — and people who are already fearful of their existing jobs aren’t likely to jump into real estate investments of any kind, either.
None of these issues will get addressed by a homebuyer tax credit. It’s just another of the Cash for Clunkers projects from an administration that clearly has gotten in over its head on economics, and just as clearly has no idea what to do after their first plan failed.
Blowback
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How about the government just stays out of the housing market and lets it recalibrate? Instead of, you know, driving purchases from the future into the present and then trying to do the same thing when those future purchases don’t materialize either?
THEY. NEVER. LEARN. It’s unbelievable.
Good Lt on August 30, 2010 at 9:34 AM
That’s their answer to everything. More stimulus. Which means more debt piled on the taxpayers with nothing to show for it in the end.
Doughboy on August 30, 2010 at 9:34 AM
I heard this interview with him this morning and almost drove off the road when he said “Obama is focused like a laser beam on jobs.”
Mr. Bingley on August 30, 2010 at 9:34 AM
Stop Fucking Digging!!!
singlemalt_18 on August 30, 2010 at 9:35 AM
Around me, they aren’t even close to hitting bottom, and more gimmicks are going to make it worse in the long run by keeping prices inflated for longer periods of time. Oh and I am just waiting for the next property value review required by our state. That should send some people into orbit when the new mill rate gets established after everything is revalued.
Johnnyreb on August 30, 2010 at 9:35 AM
Good Lt on August 30, 2010 at 9:34 AM
But . . . but . . . but . . .
We have “brilliant” people working for us in the White House.
I know they’re brilliant because they’re constantly telling me they are.
So they must be.
Signed – the MSM
NoDonkey on August 30, 2010 at 9:38 AM
I’m confused… the Cash for Everything program is still going on isn’t it? At least until January when the new Congress gets sworn in anyway.
mankai on August 30, 2010 at 9:38 AM
In the immortal words of Charlie Brown:
AAAAAHHHHHHHHHH!!!!!!
darwin-t on August 30, 2010 at 9:38 AM
We need another Blue-Ribbon panel to sit down, study the numbers, weigh all the options… and conclude “just throw money at it.”
mankai on August 30, 2010 at 9:39 AM
Seriously? I don’t even know what to say anymore. I am so dumbfounded by the stupidity/hatred of sound policies that I really don’t know what to say. I’m angry, but I can’t even express it.
MobileVideoEngineer on August 30, 2010 at 9:40 AM
hey im up for it. I’ll buy a house take the money never make a payment live rent free for a couple years with the tax credit and as the bank goes through the forclosure red tape. Then i’ll apply for a 50k no interest loan form the hub to “save myself from forclosure” take the cash and buy a little trailer somewhere and then file banruptcy..
end result my home little home for free, two years of living rent free maybe more…..all the while keeping gold in my backyard….
these idiots have no idea of the forces of corruption they ar eunleashing….
unseen on August 30, 2010 at 9:44 AM
They’ll really stimulate the market by bringing up another tax-credit scheme. I’m certain that there are now thousands of buyers lining up to get in on purchasing a new home PRIOR to any new “incentives” going into place.
darury on August 30, 2010 at 9:48 AM
If people can’t pay their mortgages they can’t afford upkeep of their properties. Call this boondoggle Cash for Moneypits.
Akzed on August 30, 2010 at 9:48 AM
This is why the economy is where it is. Total uncertainty within the system! Will taxes go up? Will Obamacare stifle job creation, or increase costs? Any thinking person is on the sidelines waiting, watching to see the effects of all these “great” changes. Give investors/home buyers a stable tax and regulatory future and things will turn around. The current tax and policy environment is too uncertain to put money at risk.
EliTheBean on August 30, 2010 at 9:49 AM
Obama, I know Santa Claus, and you sir are no Santa.
faraway on August 30, 2010 at 9:49 AM
I say lets go whole hog. Why not enact the Complete Stimulus Act, where the government pays for everything, reduces taxes, and creates jobs.
Who knew Utopia could be achieved merely by making it a law?
BobMbx on August 30, 2010 at 9:50 AM
I thank God that I was able to sell my house last month, after the gimmick expired.
Vashta.Nerada on August 30, 2010 at 9:51 AM
This administration is proving Forrest Gump’s mother right..”Stupid is as stupid does”.
Dire Straits on August 30, 2010 at 9:51 AM
Fixed. Beer Summit needed.
Del Dolemonte on August 30, 2010 at 9:52 AM
MobileVideoEngineer writes: “I am so dumbfounded by the stupidity/hatred of sound policies that I really don’t know what to say. I’m angry, but I can’t even express it.”
MVE – Perhaps you can vent your frustration November 2
alwyr on August 30, 2010 at 9:52 AM
OT: Credit schmedit.
Where’s the obligatory GZM-developer-can’t-be-bothered-with-real-estate-taxes post?
http://michellemalkin.com/2010/08/29/the-silver-lining-of-the-ground-zero-mosque-debate/
BuckeyeSam on August 30, 2010 at 9:54 AM
hi everybody! I am still following the housing collapse closely. Here are details on the imminent FHA refi program Donovan was yammering on about yesterday.
They are also ready to roll out the HEMAP, 50k ‘loans’ for unemployed folks. So they shovel the $ DIRECTLY to the banks on that one, burdening home’owners’ with even more debt.
They will do everything except HOLC trying to fix it, maybe like Churchill said, they will get it right when they run out of ideas. Of course by then Trez will have shoveled ALL our $ into the TBTF. frakkers.
just think if we had done HOLC in 07 as HRC suggested, one and done, we would have saved so far 200B on FAN FRED plus the 75b in HAMP plus the 50b in HEMAP.
AND the economy would be recovering since middle class consumers would have security over their biggest asset, their home.
But noooooooo, had to shovel $ onto the TBTF bank books. Trez thinks that the health of TBTF = the heALTH OF THE ECONOMY = THE health of consumers.
uhm no not so much guys. we need JOBS.
ginaswo on August 30, 2010 at 9:54 AM
Isn’t he the one always yammering about the same old policies of the Republicans? Where are his fresh new ideas. Tax, spend and regulate, tax, spend and regulate, the refreshingly “new” way to govern.
Cindy Munford on August 30, 2010 at 9:54 AM
NO-vember 2nd… barely 2 months away!!
Khun Joe on August 30, 2010 at 9:54 AM
I’m sick of subidizing other people’s home purchases. We bought a brand-new house in 2009, but b/c we owned a house already, did not qualify for the tax credit. Then they changed the tax-credit to allow for previous owners, but we did not meet the time-frame.
Not only am I against this plan on economic / conservative limited gov’t principals, I am personally being screwed by this program as I am paying other people to buy houses while I got nothin’!!
Monkeytoe on August 30, 2010 at 9:54 AM
ps look for GOP Sen Johnny RE Isaakson to bring up another tax credit home buyer bill, he is the genius who pushed the last 2.
ginaswo on August 30, 2010 at 9:55 AM
alwyr on August 30, 2010 at 9:52 AM
Yeah, great deal.
We give up almost 50% of our income to fund the inane ideas of these clowns our idiot fellow citizens elect.
But in return we can a vote worth .000000000001% of the total.
So we have that going for us.
I always vote but I view it pretty much as symbolic.
NoDonkey on August 30, 2010 at 9:55 AM
idiots……total IDIOTS!
SDarchitect on August 30, 2010 at 9:55 AM
the peeps who fell foe the last tax credit are already underwater. if you read the details closely that credit went to the TBTF. poor schmxcks. I still predict another 20-30% drop in housing, yeppers. maybe more here in AZ heart of DOOM! for housing. Shortly my home will be worth less than replACEMENT COSTS. oops sorry caplock!
ginaswo on August 30, 2010 at 9:57 AM
Why is the Federal Government in the housing market?
Why not a tax credit for a new car, boat, motorcycle, small plane, refrigerator, TV, too?
albill on August 30, 2010 at 9:57 AM
these libs seem to get the idea that lowering taxes increases economic activity in certain circumstances – like this, or the cash for clunkers, or the various property tax exemption schemes different state’s have, but they are against lowering taxes across the board.
So, they know lowering taxes works to increase economic activity, which will help get us out of the recession. But, they simply cannot allow people to make their own choices – they want gov’t control of choices so they won’t simply lower taxes. Instead, they have to come up with these plans that fail on all counts.
Just by putting these plans forward they admit that conservatives are correct and that lowering taxes is the answer. But their impulse toward authoritarian control simply cannot be waived.
Monkeytoe on August 30, 2010 at 9:58 AM
Just send a $100,000 check to all the homeowners, then buy them a car, groceries for a year, forgive any education loans, and a voucher for one week vacation anywhere in the U.S. (gotta keep the money in the country)…
right2bright on August 30, 2010 at 10:00 AM
The re-re-repeat will consist of the federal government outright buying houses for people.
Congresswoman Eddie Bernice Johnson(D-
TexasCuba) will be put in charge of deciding which of her family memb…er…which Americans will be given houses.Bishop on August 30, 2010 at 10:00 AM
What is it we can “afford”?
We can “afford” tax breaks which distort the market, we can’t “afford” tax breaks for the rich which may in fact stimulate the economy.
Oh, Now I get it,………… sort of.
FOWG1 on August 30, 2010 at 10:00 AM
Bad idea. I watched a video clip (trying to find link) by some motivational speaker named Tim (real tall fellow) in which he dissected what the next few years would be like. pretty good clip in which he said the increased frugalness and efforts to pay off personal debt, while painful, are a necessary step to recovery.
Good analysis on how the Boomers influence a lot of what is happening. His take is that we are in for several years of slow growth. People are saving more and paying down debt while businesses are reluctant to hire more since people are spending less. Once a lot of the debt repayment is done the purchasing will go up. Not a real “motivational” look for next several years (think Japan’s ten year recession) but a good explanation in laymen’s terms.
Bradky on August 30, 2010 at 10:00 AM
And of course the rumors of a new credit will simply suppress demand, as people wait to see if it materializes. After all, who wants to buy now and then find out that they could have gotten an extra $10k if they had waited a few months. The morons have no idea how much they contribute to our national problems simply by flapping their gums!
MJBrutus on August 30, 2010 at 10:03 AM
The broken window economy.
lorien1973 on August 30, 2010 at 10:03 AM
mankai,
Thread winnah.
Mike Honcho on August 30, 2010 at 10:05 AM
when all you have is a hammer everything looks like a nail:
http://www.youtube.com/watch?v=EfH46DTAkxo
unseen on August 30, 2010 at 10:09 AM
But they won’t extend the Bush tax cuts.
We’re only allowed to keep our own money if we’re willing to be coerced into spending it as they see fit. We can use it to distort housing or used car markets or buy a 14 SEER air conditioner, but otherwise we have to hand it over to Uncle Sammy. That’s ‘cuz Sammy knows what we need better than we do.
obladioblada on August 30, 2010 at 10:10 AM
Consumers know that buying a home anymore is just not a good investment. It’s a risk. Why doesn’t the government know this?
scalleywag on August 30, 2010 at 10:10 AM
What this country needs is a Congress full of Johnsons.
Vote Johnson 2010 and you won’t be disappointed.
NoDonkey on August 30, 2010 at 10:11 AM
The broken window economy.
lorien1973 on August 30, 2010 at 10:03 AM
we need more holligans throwing rocks it seems.
unseen on August 30, 2010 at 10:11 AM
Quandary. We’re house hunting right now and looking to purchase this winter/early spring. Do we wait? I realize how much this hurts our economy, but how do we as prospective home buyers avoid that?
Bee on August 30, 2010 at 10:11 AM
LOL! Exactly. Here’s an idea: How about if we set some land aside in Nevada, let’s say, and begin work on some enormous stone pyramid to bury our Dear Leader in when he dies. We can construct intricate passageways and devices to keep robbers out. Just think of how many people we employ on such a project. Why we could provide jobs for millions!
MJBrutus on August 30, 2010 at 10:12 AM
seriously I was thinking of buying a home in the nest month or so….now I’m waiting for the tax credit…
unseen on August 30, 2010 at 10:13 AM
unseen on August 30, 2010 at 10:13 AM
I plan on selling next year and buying a place outright with my equity. I’m with you in that I don’t want to make a move now.
MJBrutus on August 30, 2010 at 10:14 AM
LOL..you are on a roll..:)
Dire Straits on August 30, 2010 at 10:15 AM
My house is under by 150k and this is all the brilliant minds can come up with? Another faux program to artifically bolster up the real estate market in time for midterms? A-holes, every last one of them….
jbh45 on August 30, 2010 at 10:15 AM
MJBrutus on August 30, 2010 at 10:12 AM
Man don’t give the socilaists any ideas. they already got Teddy roosevelt on Mt rushmore.
unseen on August 30, 2010 at 10:16 AM
Under by 150k..That has got to be depressing!..I don’t know what to say..*shudders*
Dire Straits on August 30, 2010 at 10:20 AM
I see your point.. but to answer your question..you do not avoid it..you do what is in the best interest of your family and your pocketbook..that is IMHO..:)
Dire Straits on August 30, 2010 at 10:22 AM
I plan on selling next year and buying a place outright with my equity. I’m with you in that I don’t want to make a move now.
MJBrutus on August 30, 2010 at 10:14 AM
which is one of the problems with this type of gov policy. It changes the timing and introduces choas into the market. If i can wait and get an extra 8k or 10k and the chance of home prices going up is gone. then I would be stupid to not wait to buy a couple more months…then when the gov policy is started the pent-up demand will appear like the policy is working but as soon as the pent-up demand is gone it will make the follwing months look terrible….progressives see that and instead of seeing the real reason they see that the gov program can never be ended.
unseen on August 30, 2010 at 10:23 AM
My house is under by 150k and this is all the brilliant minds can come up with? Another faux program to artifically bolster up the real estate market in time for midterms? A-holes, every last one of them….
jbh45 on August 30, 2010 at 10:15 AM
Under by 150k..That has got to be depressing!..I don’t know what to say..*shudders*
Dire Straits on August 30, 2010 at 10:20 AM
walk away?
unseen on August 30, 2010 at 10:25 AM
Quandary. We’re house hunting right now and looking to purchase this winter/early spring. Do we wait? I realize how much this hurts our economy, but how do we as prospective home buyers avoid that?
Bee on August 30, 2010 at 10:11 AM
if you believe in the free market you will buy when it is in your best intrest to do so. It is only by individuals making economic decisions in their own best interest will the free market overcome government interference..
unseen on August 30, 2010 at 10:27 AM
That would have to be on the table for sure..
Dire Straits on August 30, 2010 at 10:28 AM
The sooner the government stops fiddling around in economics the sooner it will straighten out.
Wade on August 30, 2010 at 10:28 AM
Welcome to the “One Trick Pony” Administration.
GarandFan on August 30, 2010 at 10:29 AM
Dire Straits on August 30, 2010 at 10:29 AM
With exceptions for the ruling class.
TexasDan on August 30, 2010 at 10:32 AM
Would this make you move on buying. Mortgage rates and building loan rates increase, banks may then invest more in mortgages and buyers like yourself and investors may move off the fence.
Wade on August 30, 2010 at 10:32 AM
I am sure you are right and we all know where their leadership has taken us.
Wade on August 30, 2010 at 10:34 AM
Good point!..Also we must not leave out Chris Dodd and his great wisdom..:)
Dire Straits on August 30, 2010 at 10:38 AM
Ed, let’s be honest. If a Republican administration had proposed a homebuyer tax credit, you’d be all for it, wouldn’t you?
There are way too many valid reasons to oppose Obama & the Dems for us to be criticizing the extremely rare good ideas they come up with.
itsnotaboutme on August 30, 2010 at 10:43 AM
Would this make you move on buying. Mortgage rates and building loan rates increase, banks may then invest more in mortgages and buyers like yourself and investors may move off the fence.
Wade on August 30, 2010 at 10:32 AM
well it’s more a mtter on personal econmics. My job appears safe for now…little to no debt at the moment…the price and interest rates are a major function but with the amount of supply on the market I doubt prices will go up. Unless the fed changes its policies interest rates aren’t going up esp at a time that the federal gov is borrowing $1.5 trillion a year the gov wants to keep interest rates as low as possible. So the tax credit is IMO going to be “extra money” on the table.
I’m looking at the market and seeing it is a buyers market and home prices need to come down 20-30% more to place prices back into the historical zone with wages……therefore the gov tax creidt will not come close to meeting this requirement of a drop in price by 20-30% so the impact of this policy will be small short and sharp. the home market will return its downward spiril as soon as the tax credit expires.
So if the tax credit cuts the price by 10% I might decide that the time saved on waiting for the price to fall is worth taking a 10-15% haircut on falling prices…….
but then again it all comes back to the monthly payments, local land taxes, schools etc….
unseen on August 30, 2010 at 10:44 AM
How did this rare and good idea work out the first time it was tried?..:)
Dire Straits on August 30, 2010 at 10:46 AM
itsnotaboutme on August 30, 2010 at 10:43 AM
You can be darned sure that if a Repub proposed it, I would oppose it! Just as I opposed so much of what Bush did.
Apparently you consider this a good idea. Was “cash for clunkers” also a good idea? Do you really think that our tax money should go to DC so that they could subsidize home buyers and thus increase the cost of housing? Please tell us just why that is such a good idea.
MJBrutus on August 30, 2010 at 10:47 AM
As a Realtor, I saw first hand how the tax credit did nothing but move buying decisions up by a few months. Once it expired, the market tanked again, which brings me to the next nail in the coffin of the housing market:
Embedded in the Obamacare bill is a little known gem which will go into effect in 2013. This is a 3.8% tax on home sales of $500,000 or greater. Now, suppose I have a home that is worth $515,000. With the 3.8% transfer tax, plus commissions, my net on that 515,000 sale would be about 464,000. But, if I discount the price and sell for 499,000, I come out several thousand ahead.
This is some scary chit IMO.
Chewy the Lab on August 30, 2010 at 10:48 AM
I agree, hence why we waited and didn’t jump on the last “stimulus” bandwagon even when folks were advising us to. We are in great financial shape and will be primed for purchase this year. I guess my question is, if we waited a month or two, would the tax credit help us at all, at least in the short term?
While I understand the economic implications as a whole, could someone walk out what the credit actually means for a first time home buyer? How does it work or does it at all? (I’m a complete n00b in this department.)
Bee on August 30, 2010 at 10:48 AM
unseen on August 30, 2010 at 10:44 AM
It is also all heavily dependent on local markets. If someone is planning to move or willing to move, for example (as I am), then he may well be able to sell out of a higher priced market and move to a place that has taken a bigger tumble on prices.
MJBrutus on August 30, 2010 at 10:50 AM
Hubba, hubba, hubba!
Money, money, money!
Who do you trust? Me?
I’m giving away free money.
faraway on August 30, 2010 at 10:52 AM
We’ve had that. Did you miss it?
“Cash For Clunkers” has had the effect of causing a sharp decrease in the supply and a corresponding increase in the price of used cars.
“Cash for Clunker Appliances” is going slow because the rebate for ‘greener’ appliances requires extra money to purchase more the expensive ones first. My brother passed on it with a new A/C unit, because the unit that could have gotten him a rebate of $1,500 was $3,500 more than the one he bought. The unit would have to run for 25 years before he could recoup the $2,000 in energy savings.
Motorcycles, boats, and planes are rich people’s toys. Don’t you know he’s at war with the rich?
Phil-351 on August 30, 2010 at 10:55 AM
While I understand the economic implications as a whole, could someone walk out what the credit actually means for a first time home buyer? How does it work or does it at all? (I’m a complete n00b in this department.)
Bee on August 30, 2010 at 10:48 AM
the last one was around 8k. you can get a first time FHA loan with 3% down. so for a home of 250,000 the 8k can be your downpayment. which means at the end of the day a person can get a home with no money down (except closing fees)
As long as home prices do not go up (which I doubt will happen0 nor interest rates ( which may since we are at historic lows) the best bet is to wait for the tax credit. If interest rates start to move up you would have to figure out how much interest costs you will pay over 30 years and the savings of waiting.
also understand that these low interest rates will destroy the refi market for the next decade or so. So basically the monthly payment you get now will be your payment for the next 30 years… It will never get cheaper
so basically you have to take into your decision
1) if home prices will continue to fall
2) if interest rates will fall or go up
3) the amount of the tax credit.
If you think 3) will be smaller than 1) then wait unitl after the tax credit
If you think 3) will be bigger than 1) then buy when the tax credit
If you think 2) is going to shoot up buy now
If 2) stays the same or goes down waiting is the best.
Of course everyone has their own reasons for buying besides just price…
unseen on August 30, 2010 at 11:03 AM
MJBrutus on August 30, 2010 at 10:47 AM
true
unseen on August 30, 2010 at 11:05 AM
If at first you don’t succeed,
Fail, Fail again, and again, and again, and again, and again, and again, and again, and again, and again, and again, and……
pilamaye on August 30, 2010 at 11:06 AM
My dog does the same thing. He keeps peeing on the rug, over and over again.
faraway on August 30, 2010 at 11:11 AM
It would definitely be worth it in most cases..Here is a great site that will explain it to you pretty good.
Dire Straits on August 30, 2010 at 11:14 AM
Great advice. Thank you so much!
Thanks for the link. I’m checking it out right now. Lots to think about…pretty overwhelming. :)
Bee on August 30, 2010 at 11:17 AM
Also will throw this in..Tax credits are like “manna” from heaven if you qualify.. Credits are a Dollar for Dollar offset of taxes you paid..It does get no better than that as far as how much in taxes you pay..(Small example (simple)..If you owe the Fed $4,000 in taxes and you have Tax credits worth $ 8,000..Guess what..$ 4,000 tax refund check)..:)
Dire Straits on August 30, 2010 at 11:23 AM
It will be one of the most fullfilling times of your life buying the first house..:)
PS..But IMHO the moving part suck$..
Dire Straits on August 30, 2010 at 11:27 AM
If you owe the Fed $4,000 in taxes and you have Tax credits worth $ 8,000..Guess what..$ 4,000 tax refund check)..:)
Dire Straits on August 30, 2010 at 11:23 AM
Maybe the dems might want to think about letting the child tax credit expire in Jan 1. A family of 4 with two children loses $1000.00 come Jan 1.
unseen on August 30, 2010 at 11:28 AM
PS..But IMHO the moving part suck$..
Dire Straits on August 30, 2010 at 11:27 AM
Well in my case i’m thinking of buying the house i am presently renting. the landlord wants out of the market…
unseen on August 30, 2010 at 11:29 AM
unseen on August 30, 2010 at 9:44 AM
This is exactly right. You’d better believe people are doing this and I don’t blame them.
You know at some point these idiots are going to offer stimulus and no one is going to want it. Even the libs.
ORconservative on August 30, 2010 at 11:31 AM
You know at some point these idiots are going to offer stimulus and no one is going to want it. Even the libs.
ORconservative on August 30, 2010 at 11:31 AM
when you are full and have to unbutton your jeans its hard to think the same about that next piece of cheesecake.
unseen on August 30, 2010 at 11:34 AM
Read this?
Hyperinflation, What It Will Look Like
slickwillie2001 on August 30, 2010 at 11:35 AM
All depends what you mean by “ruling class”.
If you mean teachers, professors, union officials, government bureaucrats, then they will be included plus more.
But if you mean hard working, self made businessmen and investors, then they will not be eligible.
right2bright on August 30, 2010 at 11:39 AM
Hmmm, for people like me, whose home is on the market because we will have to relocate once my husband finds a job, this is a classic conundrum. Of course, I want a qualified buyer to come along to purchase my competitively priced home (on top of giving all kinds of buyer incentives like closing assistance), and if a tax credit gets them there, then okay. However, for a conservative, government intervention in the market, in any form, is misguided and ill-conceived. I really want my home to sell, but I don’t want to compromise my principles to get there. We are realistic enough to know that we will take a loss on all of the remodeling and improvements we have put into our home, but we are also pragmatic enough to know that when it comes to selling your house, traffic is traffic, whatever gets their feet in the door. We have to eat. What’s a conservative to do?
College Prof on August 30, 2010 at 11:44 AM
OT:
Did anyone out there get their latest property tax? I’d be curious what the state figures their property value is compared to last year. I was a bit surprised that ours went down 20%. I expected a drop, but where I live, not that much. That puts us a little underwater on the mortgage, but not bad. Yet…
Observation 1: the state is going to take a real nasty hit the year in property tax revenues. If my property is an example, expect about a 20% shortfall not counting foreclosures and abandoned homes. That’s going to hurt. And that’s not counting other revenue shortfalls from overall decreased personal spending.
Observation 2: If I WAS in a buying position right now, I’d wait. Property values aren’t going north for a long time, and will probably head south. I’d protect my capital and wait for the market to drop further. It will.
karl9000 on August 30, 2010 at 11:49 AM
The only thing worse than the distortions they have already caused is to create even more uncertainty about it>
If people think they might revive the credit, they will definitely not buy right now.
If they just come out and say, “OK, no more credits”, then the market my go back to normal eventually.
forest on August 30, 2010 at 11:49 AM
I have got to wonder what these clowns are thinking!
Having just been told that if you wait to buy, you might get a windfall, what idiot is going to buy now? The announcement itself will kill/delay some sales.
I am still pissed that folks who overextended themselves on mortgages are having themselves bailed out while those of us who were more sensible and diversified by investing in houses AND stocks have the Admin actively working to prevent recovery.
Why are houses so special anyway?
OBQuiet on August 30, 2010 at 11:49 AM
We have to be wrong..According to Obie those Bush Tax cuts only helped the RICH folks..:)
PS../sarc tag included..
Dire Straits on August 30, 2010 at 11:54 AM
I want a 5th wheel trailer, is there a tax credit for that yet? Wake me when it happens. Our mortgage is not under water so we don’t qualify for a refi or a tax credit but I’m helping to pay for some other slubs house payment. What a great country.
Kissmygrits on August 30, 2010 at 12:01 PM
Consider yourself lucky..:)
Dire Straits on August 30, 2010 at 12:03 PM
Dire Straits on August 30, 2010 at 11:54 AM
the really sad thing is the GOP is not using this information in their campaign ads. apinting themselves as the defender of the middle class would be gold.
Instead we hear about the “bush tax cuts” and “income tax brackets”
the GOp should be using this to batter the dems.
Saying things like Rep Ethridge has refused to vote to extend the $500 per child tax credit. why does your Rep not understand that family is important and government tax policy should promote having children not discourge it. Why do you hate children Mr. ethridge?
unseen on August 30, 2010 at 12:07 PM
This is what makes me mad at the GOP. the dems have tied the tax cuts of the Bush years to the RICH and to BUSH. Both hated groups in terms of moderates. They have allowed the tax cuts to be highjacked.
the GOP is not smart enough it appears to reclaim the middle. the GOp should never again mention the word “Bush tax cuts” or “capital gains tax cuts”.
they should instead use terms like “keep the child tax credit”. Stop the dems from “taxing your savings” stop the “death tax” Stop the “small business tax increase” “Protect workers by allowing small business tax cuts to survive so they can hire more workers” etc.
the GOP must connect with middle class and embrace the middle class or they will never sell their policies.
unseen on August 30, 2010 at 12:12 PM
Don’t give up yet..I’m sure the Republicans will bring this to the front and center stage when Congress comes back in mid September..The Tax cuts will come up big between now and November..:)
Dire Straits on August 30, 2010 at 12:15 PM
Very good post!..and wise advice I might add..:)
Dire Straits on August 30, 2010 at 12:17 PM
The Tax cuts will come up big between now and November..:)
Dire Straits on August 30, 2010 at 12:15 PM
Let’s hope. I think it will be the tea party candidates like Angle and Paul that will be the ones bringing it up. I don’t see the Mitt’s of the world connecting the dots…
unseen on August 30, 2010 at 12:25 PM
What really disgusts me about the homebuyer tax credit, is it is simply a way to help banks unload their foreclosures.
The money did not help the folk who lost homes, it channeled to the banks, by increasing money for foreclosures by speculators and sharks greedy to claim family nests for a penny on the dollar
Foreclosures are piling up again. I was told by a Floridian that many banks in Florida are not releasing foreclosures for sale. I am guessing they are wsiting for next tax year, to take write offs when obama-tax goes into effect. The next home buyer tax credit I assume will be timed for the coming bank fire sale.
The tax credit will make home sales figures look good. It will pump the banks’ short term bottom line, and it will create a new generation of slum rental lords. A few younger folk, who did not have a lifetime of earnings and effort to lose, will cash in and take their pick of another generation’s possessions
entagor on August 30, 2010 at 12:37 PM
Well in my case i’m thinking of buying the house i am presently renting. the landlord wants out of the market…
unseen on August 30, 2010 at 11:29 AM
Get a good lawyer to write in a clause that you will buy if the credits do come to pass,get the seller to split closing costs and LOW BALL the deal. Some folks jut plain want out.
Col.John Wm. Reed on August 30, 2010 at 3:13 PM
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