It’s starting to sound like, “The Song that Never Ends””¦
On Sunday, HUD Secretary Shaun Donovan implied on an interview with CNN’s Ed Henry that the Obama administration that the $8,000 home buyer tax credit could be revived.
HENRY: Let’s end on two quick points. First of all, along the lines of this debate, there are some critics saying the federal government can’t keep up the intervention to try to prop up the industry much longer. Along those lines, you mention the $8,000 first-time home buyer credit expired a couple of months ago. Many people believe that’s why some of the housing numbers were so bad this past week. Is that housing credit now dead? Or does the administration think you should try to revive it to try to prop this industry up?
DONOVAN: Look, Ed, I think it’s too early to say after one month of numbers whether the tax credit will be revived or not. All I can tell you is that we are watching very carefully. I talked earlier about new tools that we will be launching in the coming weeks, and we are going to be focused like a laser on where the housing market is moving going forward, and we are going to go everywhere we can to make sure this market stabilizes and recovers.
Will the tax credit return? Who knows. But it’s not beyond the realm of possibility”¦
Should it be revived? Did the tax credit really help the housing industry, or did it just pull in buyers that would have bought anyway?
I’ll go out on a limb and say there are many agents salivating at the thought of a revived tax credit, and I’d be shocked if the National Association of Realtors didn’t lobby, hard, for it.
Personally, I have yet to be convinced the home buyer tax credit did much to truly help a housing recovery. And I am completely convinced that buying a home just to score an $8,000 tax credit is a bad idea. A really bad idea.
As I wrote on May 1st in, Home Buyer Tax Credit: So long, and thanks for all the fish, and in June 2009’s, How the Government can Fix the “Foreclosure Crisis”, I feel that the government ”“ and We the People ”“ need to understand that housing market will correct itself. Will we like it? Will it be pretty? Nope. But further mucking about in the market will only postpone the inevitable, and quite possibly through unintended consequences make it even worse.
We need to suck it up, and give the market time to correct.
Here’s an article from CNBC (courtesy of @MortgageProBlog) where the author seems to agree with me. She went the extra step to contact HUD spokesperson who responded: “No news here…there are no discussions underway to revive the credit.” Granted, there are no discussions yet, but anything can happen in D.C. — especially in an election year — and some politicos are already weighing in that reviving the credit may be a good idea…
Hat tip to Inman News on the Donovan interview (this article will slip behind Inman’s pay wall tonight).