Mortgage interest rates are declining and in some zip codes home price growth is slowing, but the number of first-time buyers purchasing homes is still declining. So why not make buying a house more affordable for first timers with a federal tax break?
Mortgage company CEO Sanjiv Das argues in a MarketWatch opinion column that a nationwide incentive coupled with the mortgage interest rate deduction could serve as “tailwinds” for first-time buyers who currently are unable to buy a home even though they have the capability and intention to repay a loan.
It’s time to re-adopt the tax break for first-time homebuyers at the federal level. A similar measure was introduced in 2008 and provided a credit up to $7,500 for first-time homebuyers. This initiative could be structured as a zero-interest loan that is paid back over several years or as a full credit. This eligibility for this credit could be targeted exclusively to first-time buyers over the next two years, which could be enough time for many young Americans to take advantage of this opportunity.