Biden Proposes a Tax Credit for First-Time Home Buyers

Today’s topic came up recently at the State of the Union address. One of the things that was proposed (relating to real estate) is a $10,000 credit, paid in increments over two years.

Why a Home Buyer Tax Credit is a Bad Idea

I wanted to chime in: on the surface, it seems like a great idea. It helps with affordability and gives everyone a little tax credit for first-home homebuyers and move buyers.

But, let’s think about it a little deeper. Every expert you talk to about real estate right now agrees that the problem is the amount of inventory. We are not having a problem with the number of buyers in the market.

In fact, most of what I am seeing is that we have too many buyers. When there are too many buyers, it results in multiple competing offers on the inventory, prices are on the rise, and it’s just a little out of control.

So, the notion of offering a tax credit to bring even more buyers into a market like this… it cannot be a good idea! It can’t end well.

We’ll See What the Future Has in Store

Of course, the market is always changing, and we can’t predict the future. So, we’ll see how things play out. For now, I stand behind the opinion that a home buyer’s tax credit isn’t going to fix the current real estate challenges – it will only make it harder to buy a home because of low inventory.

Do you have questions about your financing options for buying a home? Reach out to me any time! I’m always here to help you find the ideal solutions for your unique needs.