The $15,000 home-buyer tax credit in the stimulus bill is a HORRIBLE idea

[wiegie]

It is going to cost about $40+ billion and for what? Nothing. It makes no freaking sense at all and it will NOT be stimulative nor will it fix the housing problem.

 

The only thing it will accomplish is to transfer taxpayer wealth to realtors.

 

Q: So, why the hell would Senator Johnny Isakson push for it?

 

A: Because he is a freaking realtor!!!

 

Seriously, no matter what you feel about the overall stimulus package, contact your senators and representatives tell them to not them put this steaming pile of crap into the final bill. Please!

[Perchoutofwater]

Most of the bill is crap! I've already called emailed my senator. He's trying to add something non-stimulus related that I actually agree with, but I told him if he tagged it on to this bill I would never vote for him again, and would do all I could to see the doesn't get elected again. I told him we need to cut all the non-stimulus crap out of the bill, and you can hardly point fingers at the libs when you put in funding for your pet project, even when I agree with more funding for Guard and Reserves.

[General Itals]

I agree with you, since I managed to purchase a home a couple of months before this provision will take effect.

 

This amendment was passed by a voice vote and nearly 100% support in the Senate, so you can huff and puff all you want, but it's gonna stay in.

 

Edit to add: And just a FYI, Isakson is a conservative Republican from Georgia who got this through the Democrat controlled Senate. He also got this exact same amendment through last term, but it got watered down by the House into the $7500 interest free loan which current first time homebuyers can take advantage of.

Edited February 7, 2009 by General Itals

[CaP'N GRuNGe]

Explain to me how it only helps realtors? What about people with good credit and a good income stream but don't have savings yet to put money down on a home. Won't that help them buy a house sooner and help somewhat to reduce the inventory on the market?

[wiegie]

Explain to me how it only helps realtors? What about people with good credit and a good income stream but don't have savings yet to put money down on a home. Won't that help them buy a house sooner and help somewhat to reduce the inventory on the market?

If they limited the bill to first-time homebuyers it wouldn't be such a clusterf*ck, but that isn't what is happening.

 

But overall, housing is STILL overpriced and maintaining the bubble is a bad idea. There are better ways of fixing the housing problem.

[General Itals]

Explain to me how it only helps realtors? What about people with good credit and a good income stream but don't have savings yet to put money down on a home. Won't that help them buy a house sooner and help somewhat to reduce the inventory on the market?

 

The only way it helps realtors is if this bills affect is to stimulate housing sales, and wiege already said it won't, so I'm not sure what his argument is. And even if it does boost sales, thus boosting realtor commissions, it would only indirectly be on the taxpayer's dime.

Edited February 7, 2009 by General Itals

[wiegie]

I agree with you, since I managed to purchase a home a couple of months before this provision will take effect.

 

This amendment was passed by a voice vote and nearly 100% support in the Senate, so you can huff and puff all you want, but it's gonna stay in.

I just sent e-mails to both of my senators telling them to oppose this provision. Please do the same.

[wiegie]

The only way it helps realtors is if this bills affect is to stimulate housing sales, and wiege already said it won't, so I'm not sure what his argument is. And even if it does boost sales, thus boosting realtor commissions, it would only indirectly be on the taxpayer's dime.

It might stimulate sales, but so what? Since this bill applies to existing housing, all it will do is cause assets to be transfered around. Suppose I gave you a $5000 tax credit to buy a used car, you might buy a used car, but nothing new got created in the economy. This is the economic equivalent of paying people to dig holes in the ground and then paying them again to fill the holes up. It is not a productive use of our money.

Edited February 7, 2009 by wiegie

[TimC]

You could've saved alot of typing and just said, The stimulus bill is a HORRIBLE idea.

 

Let them fail and we'll all be better off in the long run. So, you bail out these companies and stimulate them like a 2 dollar hooker and what do you have afterwards? Answer: Nothing different.

 

Biggest waste of money and downright theft in the history of the world.

[Perchoutofwater]

You could've saved alot of typing and just said, The stimulus bill is a HORRIBLE idea.

 

Let them fail and we'll all be better off in the long run. So, you bail out these companies and stimulate them like a 2 dollar hooker and what do you have afterwards? Answer: Nothing different.

 

Biggest waste of money and downright theft in the history of the world.

 

+1

[Scooby]

If they limited the bill to first-time homebuyers it wouldn't be such a clusterf*ck, but that isn't what is happening.

 

But overall, housing is STILL overpriced and maintaining the bubble is a bad idea. There are better ways of fixing the housing problem.

 

My in-laws are loving this idea of a tax credit, they're already talking about buying a new house now...in TX, where housing is by and large not overpriced

[Puddy]

My brother and I live one block from each other in virtually identical homes. Maybe I should buy his and he can buy mine. We each pocket 15k and we simply don't move our stuff.

[Scooby]

ok, now I'm reading this might have to be re-paid???:

 

http://www.associatedcontent.com/article/1..._pg2.html?cat=3

 

are there any income limits, in other words, can the higher tax bracket folks capitalize on this, what about AMT? I'm confused.

[wiegie]

ok, now I'm reading this might have to be re-paid???:

 

http://www.associatedcontent.com/article/1..._pg2.html?cat=3

 

are there any income limits, in other words, can the higher tax bracket folks capitalize on this, what about AMT? I'm confused.

that article is old--they did not include a repayment provision (which at least would have made this credit not so completely horrible) and they also don't have any income limits on this one either (which is another thing wrong with the credit).

[wiegie]

My brother and I live one block from each other in virtually identical homes. Maybe I should buy his and he can buy mine. We each pocket 15k and we simply don't move our stuff.

you technically have to live in your new house for two years to get the credit--but I'm sure that no one will find a way around that provision :oldrolleyes:

[Scooby]

that article is old--they did not include a repayment provision (which at least would have made this credit not so completely horrible) and they also don't have any income limits on this one either (which is another thing wrong with the credit).

 

not that I'm up there in the tax bracket like my in-laws, but what's wrong with letting the wealthier get these tax breaks, since many of them like my in-laws, own businesses, create jobs, the essence of what the govt is trying to do is spark the economy, I say save the whole fair/ vs unfair thing for now, you would not believe how many taxes my in-laws pay, I know, I work for them, let's see, they have to match dollar for dollar on FICA & medicare, they pay franchise taxes, income taxes, state unemployment taxes, gas taxes...I know I'm forgetting a host of others

[Ursa Majoris]

Am I right in supposing that those of us who studied the market and mortgage rates, did some due diligence and re-fied into a safe fixed rate at the right time without blowing all the equity will just carry on paying the mortgage and reaping no tax benefit?

 

Thought so.

[bushwacked]

Am I right in supposing that those of us who studied the market and mortgage rates, did some due diligence and re-fied into a safe fixed rate at the right time without blowing all the equity will just carry on paying the mortgage and reaping no tax benefit?

 

Thought so.

 

 

[Jimmy Neutron]

I agree that this is one of many bad provisions in this bill.

[wiegie]

not that I'm up there in the tax bracket like my in-laws, but what's wrong with letting the wealthier get these tax breaks, since many of them like my in-laws, own businesses, create jobs, the essence of what the govt is trying to do is spark the economy, I say save the whole fair/ vs unfair thing for now, you would not believe how many taxes my in-laws pay, I know, I work for them, let's see, they have to match dollar for dollar on FICA & medicare, they pay franchise taxes, income taxes, state unemployment taxes, gas taxes...I know I'm forgetting a host of others

I'm not making a fair vs. unfair argument.

 

The goal is economic stimulus. It is a simple fact that poorer people have higher marginal propensities to consume than wealthier people and as such, the multpilier effect of giving them money will be higher than if you gave more money to wealthier people.

 

Additionally, given the higher down payment requirements to buy a house today, wealthier people would be more likely to buy a house today than poorer people and will hence be more likely to the benefit of the tax than poorer people.

Edited February 8, 2009 by wiegie

[jackshi17]

If poorer people use this "free money" to qualify for a new home purchase I think the first time they have a problem making their house payment we're back to square one--another bailout?

[Robash]

is if 15k to buy a house or 15k if you bought a house? we took that 7.5k this year and will be using most of it to improve our home...which means that money goes to local companies therefore stimulating our economy right? i know it puts the government in debt for 15 years, but i dont see it as a bad thing.

[Ursa Majoris]

is if 15k to buy a house or 15k if you bought a house? we took that 7.5k this year and will be using most of it to improve our home...which means that money goes to local companies therefore stimulating our economy right? i know it puts the government in debt for 15 years, but i dont see it as a bad thing.

Actually it puts YOU in debt for that $7.5k - it's repayable over 15 years right now. The new thing is a tax credit, not a loan.

[muck]

Puddy ... I'm ashamed of you!

 

 

... I think my neighbor across the street would be up for this, though ...

[General Itals]

It might stimulate sales, but so what? Since this bill applies to existing housing, all it will do is cause assets to be transfered around. Suppose I gave you a $5000 tax credit to buy a used car, you might buy a used car, but nothing new got created in the economy. This is the economic equivalent of paying people to dig holes in the ground and then paying them again to fill the holes up. It is not a productive use of our money.

 

Soooooo, what you're saying is that people who already own an overvalued house, which they're probably upside down on, are going to go out and try to sell it, so they can buy somebody elses overvalued house so that they can pocket 15K? Seriously?

 

 

The goal is economic stimulus. It is a simple fact that poorer people have higher marginal propensities to consume than wealthier people and as such, the multpilier effect of giving them money will be higher than if you gave more money to wealthier people.

 

Additionally, given the higher down payment requirements to buy a house today, wealthier people would be more likely to buy a house today than poorer people and will hence be more likely to the benefit of the tax than poorer people.

 

This isn't even close to the truth. The majority of home sales today, and in the foreseeable future, unlike 3-5 years ago, are going to be FHA sponsored loans. 3.5% down. 580-600 credit score minimum.

 

wiegie, you usually bring the thunder, but this is some pretty weak chit you are throwing around.