RISMEDIA, October 2, 2009—According to a recent survey of real estate agents, the first-time homebuyer tax credit has been extremely successful in stimulating the housing market and the overall economy. However, the overwhelming majority of agents polled, see challenges for real estate if the tax credit is allowed to expire on Nov. 30, 2009.
Of the nearly 1,000 agents surveyed in a study conducted by Weichert, one of the nation’s largest independently-owned real estate companies, 71% reported that the $8,000 tax credit was the single largest factor motivating the buyers they have worked with in 2009 far surpassing affordable home prices (20%) and low interest rates (8%).
While the tax credit has helped stimulate the market since being passed by Congress in February, it appears real estate agents feel more support is needed. The vast majority of respondents (92%) think the market will decline if the tax credit is allowed to expire this year. Given that expectation, it’s not surprising that 97% favor extending the tax credit with the majority wanting to continue the credit until Dec. 31, 2010.
“The tax credit is working to restore confidence and stimulating the overall economy but we still have a long way to go before we return to a normal market,” said James M. Weichert, president and founder of Weichert, Realtors. “As this survey shows, many in our industry are concerned that we will lose much of the ground that has been made toward a recovery if the tax credit is not extended.”
The survey further revealed that agents think expanding the tax credit to include current homeowners would help expedite the recovery for higher-priced homes–something that has yet to happen as a result of the first-time buyer tax credit. Respondents felt nearly nine times more confident in saying that we are very likely to see a recovery in mid- to high-priced homes in the next one to two years if existing homeowners could also receive the tax credit (61% to 7%).
Beyond aiding the housing market, the tax credit appears to have had a stimulating impact on other sectors of the economy as intended. Agents reported that 39% of buyers used the money they received from the tax credit for renovations and remodeling while another 20% purchased household items such as electronics, appliances and furniture with the financial incentive they received for purchasing a home.
The survey also revealed that agents feel the tax credit is vital to stabilizing the national economy. Of those polled, 84% felt extending and/or expanding the credit is very important in the ongoing recovery effort.
For more information, visit www.weichert.com.