Congress should extend, expand home tax credit
Following the worst downturn in decades, housing is beginning to show signs of a fragile recovery. So allowing the $8,000 first-time home buyer tax credit to expire at the end of November risks causing a relapse in the housing market that could forestall an economic recovery even before it has time to take root. This is the last thing the country needs, with unemployment moving toward double-digits and builders already reporting that entry-level buyers are pulling back as the tax credit deadline approaches.
In virtually every decline since World War II, housing has been the catalyst to lead the nation out of recession. Our industry stands ready to once again take a productive role in moving the economy to higher ground. But Congress needs to be steadfast and extend the tax credit for an additional year, making it available to all buyers of a primary residence. This would spur more than 383,000 additional home sales and help mitigate the foreclosure crisis by whittling down inventory at all levels of the housing market, setting the stage for a full recovery. It would also provide the economy with what it needs most, creating nearly 350,000 jobs during the coming year in many industries, including manufacturing, retail and real estate-related activities.
Housing accounts for more than 14 percent of the gross domestic product and represents the best opportunity to lead the overall economy forward. A tenuous upturn now appears underway, but for millions of Americans who are out of work or fear losing their jobs, it will remain a recession until businesses start hiring again. Congress can help housing take a lead role in putting America back to work by taking quick action on the tax credit and urging regulators to restore the full flow of credit needed by both home buyers and home builders.
Contact your Congress persons to extend this credit as well as expand it.
-- Sharon Westerholm, Detroit Lakes
(Westerholm is the executive officer of the Lake Region Homebuilders Association)