Finally after a year of bad news, the US have, for the third quarter, documented a GDP growth of 3.5%. Furthermore, the once-ailing real estate market has shown great improvements since last winter.

Is the United States finally on the route to recovery? Right now, the US housing market is stuck with 7.5 months’ supply of merchandise. Even though this may sound alot, think about the fact that in January of this year the real estate stock was at a massive 12 months plus. Eyes of all real estate agents (but also possible buyers) are now on one thing – the first time home-buyers’ tax credit.

The chance to acquire a $8,000 tax credit (or even cash back, if the recipient’s income tax doesn’t reach this level) has been a powerful stimulant for the US real estate market. All great things must come to an end and these tax credits are due to come to an end soon, leading to disquiet amongst the market watchers. What will occur once the tax credit is no longer on offer?

An extension bill is being prepared which, if passed, will perpetuate these tax credits until 2010. The US president should hopefully receive this bill which has had it’s path cleared by the Senate. The recommendations will increase the couples income threshold to $225,000 and the extension will expire on 30 April. And that’s not everything – a new $6,500 tax credit for move-up real estate owners was attached to the bill.

If this bill goes through, then the lures offered should encourage the movement within the property market, but the question is – how is the budget going to support it?

This entry was posted on Sunday, December 20th, 2009 at 6:56 am and is filed under Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.