A Quiet NAR Success on Its Calls for Action

By Robert Freedman, Senior Editor, REALTOR® Magazine

There are many reasons for the success of NAR’s most recent Call for Action, to which more than 18 percent of NAR members—a record— responded.

First and foremost is the compelling subject of the CFA: getting the home buyer tax credit extended and expanded. As NAR Chief Ecionomist Lawrence Yun has been saying for weeks, residential home prices are stabilizing and are on the cusp of heading up—the all-important precursor to restored confidence in homeownership. We’re relying on that improved confidence to boost sales, tighten inventories, and restore healthy credit markets.

Given that, letting the credit expire on Nov. 30 could have stopped sales momentum dead in its tracks.

It was also huge that Congress added the $6,500 credit for repeat buyers, because throughout 2009 much of the sales weight has been carried by first-time buyers. For market stability, repeat buyers needed to get off the fence and Congress saw that. Read more

The Tax Credit Vs. Cash for Clunkers

By Brian Summerfield, Online Editor, REALTOR® Magazine

Amid several news reports that the first-time home buyer tax credit will almost certainly be extended, I’ve seen more than a few blogs and online comments arguing against it. Some of them say the government can’t afford it, and lament the fact that we’re borrowing from our children and grandchildren to pay for this. Others maintain that the tax credit artificially stimulates demand, and the market will resume its slump whenever it does expire. Still others claim that it hasn’t really motivated enough buyers who would not have otherwise purchased a home to justify the program.

I may disagree with some of these arguments, but I’m glad people are making them. It’s essential that we have a healthy debate on this important subject rather than move forward with our eyes closed and our mouths shut.

However, there is one argument that I take issue with: The tax credit and the “Cash for Clunkers” program are essentially the same thing. I’ve read this line of reasoning in a few places, and in each instance, it seems to confuse rather than clarify. It seems to me that the two initiatives are very different in a few significant ways: Read more

Top 5 Daily News Stories Last Week

Here are the top five items from the Daily News last week: Read more

Tell Your Clients: Don’t Wait on Tax Credit

By Robert Freedman, Senior Editor, REALTOR® Magazine

A handful of bills to extend and increase the First-Time Home Buyer Tax Credit are under consideration in Congress, but if you have clients who are holding out in anticipation of one of these bills passing, you might want to encourage them not to wait. The likelihood of any of these bills getting enacted this year is highly uncertain.

That’s the message I’m getting from NAR analysts. The issue isn’t the tax credit itself. From everything we’re seeing, the credit enjoys broad bipartisan support and, as our chief economist Lawrence Yun has said, the credit is a bargain when it comes to economic stimulus. You get a lot of bang for the buck, and I think it’s safe to say that a lot of lawmakers realize that. Certainly Sen. Johnny Isakson (R-Ga.) does. He’s the lead sponsor of a bill to extend and increase the credit, and he’s been a champion on what the credit can do for the economy.

The problem, rather, is far more prosaic. Read more