Mark Vitner, senior economist at Wells Fargo Securities, figures Congress probably will extend the credit but not expand it. And he's not counting on it being reactivated without a break. Congress has its hands full with health care.
"I think it's been fairly successful," Vitner said of the credit. "It's given housing a lift at a time it really, really needed it."
Teasing out the number of Americans who decided to buy because of the $8,000 isn't easy, but the National Association of Realtors believes the credit will be responsible for a 350,000-home bump in resales this year. That would mean a 1 percent gain over last year rather than a 6 percent drop. In the Baltimore metro area, year-over-year home sale numbers began to rise this summer after a slide that began in late 2005.
About 1.4 million homes sold in the first seven months of the year were bought by first-timers, the Realtors group said. That would be a collective $11 billion in tax breaks, if they all qualify. (The credit phases out for higher-income buyers and decreases for lower-priced houses.)
The credit was an important motivator for the Ogles, who live with their parents and have a lot of household items they'll need to buy when they move. Chad Ogle, 22, signed a contract in May for a Ryland townhouse in Aberdeen. Derek Ogle, his older brother, signed a contract in the middle of June for a home in the same townhouse group, both because he thought it was a good deal and because he said he was told that construction would get going quickly if one more unit were sold.
If not for the credit and its impending deadline, Derek Ogle said, he might have taken his time and looked at more homes for sale.
"That was just a huge reason I bought so quickly," said the 24-year-old, an emergency-room nurse. He and his brother are aggravated about other aspects of their purchases, but it's the thought of losing out on the tax credit that frustrates them the most.
Nothing in the contracts promised that the homes would be complete in time to meet the tax-credit deadline, as Ryland points out. John Meade, president of Ryland's Baltimore division, said the company doesn't make oral promises to customers, either, because there are no timing guarantees in construction. "We're very careful that they understand we cannot commit to a delivery date," he said.
