Plenty of houses available!

Ah the lovely shadow inventory. Those lovely homes that are clearly vacant and have mile-high grass and weeds growing out of the landscaping.

 

Yeah. Banks can't sell them. But won't pay taxes, won't keep them up.

Poor bankers.

 

But he makes a valid point.

Why exactly do you need the 8K rebate before you'll buy a house? Just curious, not trying to be a dick.

 

You guys can't be serious questioning the value of EIGHT THOUSAND FREE DOLLARS. A $200,000 house would cost $192,000, with a 10 percent down payment of $12,000 instead of $20,000. Is this really not making sense to you?

 

Some things I won't buy without a coupon. I can still afford them.

 

First, if what I think is correct, you don't get that 8K at closing. You get it back at tax time. And second, I know a handful of people who have gotten the 8K credit and NONE of them used it to pay off the house. Not saying MustangJ wouldn't use it for that; I can't speak for him.

Back to what McNulty said...if that 8K is the difference in buying a home and not buying a home, you probably can't afford it. You're spending hundreds of thousands of dollars (in most cases). What difference is 8K going to make? Not much.

 

http://www.federalhousingtaxcredit.com/faq1.php#3

For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000 owed).

What I am saying is that yes you would pay the $20,000 out of pocket, but you would pay $8,000 less in taxes; ergo, your net cost for the down payment is $12,000.

 

You don't get the credit immediately, but it is money coming back, similar to the Earned Income Tax Credit. I'm sure there were deals were banks took the credit as a down payment.

 

Same here. That's why I was asking him to clarify.

 

Because houses can be good investments, if you're using it as a rental property. The tenants essentially pay for the expenses, and hopefully, there's a profit at the end of the month for the owner. And you hope that the value of the house increases over time, so that you can make more money with it.

 

I agree with that Baron. That's why the wife and I are buying a house to rent. That's a business.

But my everyday home, I don't view that as an investment that's had to guarantee me a dividend at the end of five, 10, 25 years, whatever.