The trade-in market for homes — up or down — would stand to benefit from the latest version of a federal homebuyer tax credit, leaders of local real estate and builders associations said Thursday.
“It’s going to help the broader market. It will help the people who want to move up, and the seniors, and the baby boomers who are now in their 50s and 60s and no longer have kids at home. It’s a perfect tax credit,” said Dean Graven, president of the Springfield Area Home Builders Association.
The plan approved Thursday would extend an existing tax credit of up to $8,000 that is limited to first-time buyers, but it also would provide a credit of up to $6,500 for buyers who have owned their existing homes for at least five years.
Two reports a couple of weeks ago showed local home construction and sales picking up for the first time in months. In both cases, the improvements were attributed to the $8,000 first-time homebuyers tax credits, which started last spring.
Capital Area Association of Realtors president Linda Nelson said sales have remained strong into the fall, but that there have been signs the market was slowing as expiration of the tax-credit neared.
“The number of showings has slowed,” said Nelson. The current tax credit was scheduled to expire Nov. 30.
Nelson also said the expanded credit will encourage trade-up and trade-down buyers, but that a lot of first-time buyers had run out of time to complete the closing process ahead of the existing deadline.
“Maybe last week if you had an in-house mortgage with a local banker, you might have made it (by Nov. 30), but it would be darn near impossible right now if it had not been extended,” said Nelson.
Tim Landis can be reached at (217) 788-1536 or tim.landis@sj-r.com.
