New home buyer credit has Realtors supporting federal stimulus

Although the debate continues about the wisdom and/or necessity of the federal stimulus bill, Arkansas Realtors are hoping a homebuyer tax credit provision of the bill stimulates home buying.

Arkansas home sales in 2008 were down 18.16% when compared to 2007. Crawford, Franklin and Sebastian counties posted a 13.9% percentage decline in the number of homes sold in 2008.

The new homebuyer tax credit of up to $15,000 would double the previous credit and, more importantly according to Realtors, does not require the homebuyer to repay the credit.

“This new credit could help with people who are on the edge of making a decision” to buy a home, said Larry Rhodes, a Fort Smith Realtor and owner of the Re/Max franchise in the area. “Will it do that (increase 2009 home sales over 2008 figures)? I don’t think anyone knows for sure. … It will depend on how many people react to the stimulus.”

Details of the new homebuyer credit include:
• Becomes effective when bill is signed into law
• Credit available for all home buyers, not just for first-time buyers
• Repayment required if home sold within two years of purchase
• There is no income limit

The National Association of Realtors, which lobbied hard for passage of the federal stimulus bill, is saying the new credit rule will result in about 1 million home purchases in 2009.

The Arkansas Realtors Association also urged its members to encourage the Arkansas Congressional delegation to support the stimulus plan, said ARA spokesman Ethan Nobles. Nobles said the ARA did not have a projection on how many 2009 Arkansas home sales might be attributable to the new credit rule.