Homebuyer tax credit extension to start this week

Published 6:27 pm Friday, December 4, 2009

This week, an extension goes into effect allowing North Carolinians to continue to take advantage of the federal $8,000 homebuyer tax credit which has successfully increased home sales across the nation this year. Congressman Heath Shuler (D-Waynesville) voted to extend the tax credit beyond its original expiration date of November 30 to April 30, 2010.

Experts say the first tax credit has been responsible for the sale of hundreds of thousands of homes nationwide this year, said Congressman Shuler. This tax credit will help working families and individuals fulfill the dream of homeownership during these challenging economic times.

Congress established the $8,000 homebuyer tax credit as a component of the American Recovery and Reinvestment Act of 2009, which passed the House of Representatives in February.&bsp;&bsp; Last month, Rep. Shuler voted with a majority of Congress to pass the Worker, Homeownership and Business Assistance Act of 2009 that extended the tax credit through April 30.&bsp; Members of the Armed Services who buy a principal residence in the United States can claim the credit for an extra year.

Sign up for our daily email newsletter

Get the latest news sent to your inbox

More than 55,000 North Carolinians have taken advantage of the tax credit through November 2009, according to the National Association of Realtors, and about 2 million homebuyers have used it nationwide. Pending home sales have increased nine months in a row, and the National Association of Realtors credits the tax credit for spurring the increase in real estate activity. Additionally, the group estimates that each home sale generates approximately $63,000 in direct spending on appliances, furnishing and other goods and services, which helps the overall U.S. economy.

Miles Gregory of Gregory Realty Co. in Franklin said that the recent slowdown in the residential real estate market was the worst hes seen in 40 years of business. He lauds the tax credit for helping to stimulate recent sales of homes in the area.

The tax credit just is a godsend that helps break the ice and is sending the real estate market in the right direction, Gregory said.

The bill primarily aids first-time homebuyers, but homeowners who have lived in their home for five consecutive years also are eligible for a $6,500 tax credit for new home purchases.

This tax credit not only benefits homebuyers but all homeowners because it shores up residential real estate prices, said Congressman Shuler. This bill will help contribute to a rebound in the real estate market, job growth, and a boost to the overall economy.