With the passage of Obama’s stimulus package, The Housing and Economic Recovery Act of 2008, and the President signing it into law, we can look at how the package will provide some housing opportunity although not nearly as much as some people would like. Many trade groups are patting themselves on the back and taking credit for some of the housing “victories” and others are trying to shine a positive light on an otherwise less than earth-shaking housing stimulus. Even with the changes, these parts of the package are not enough to help seniors sell their homes. Lets hope for act two later this spring. Here are some of the highlights:
- Reverse mortgage limits increased to $625,000 for the balance of 2009 – The question is when will HUD and Lenders implement this?
- $4 billion to preserve, repair and improve public housing with a $1 billion specified for energy conservation
- $250 million in grants or loans for HUD assisted affordable housing where by improvements must extend affordability by retrofitting projects for “green concepts”
- Tax credit support is provided by two means. The first of which is a tax credit exchange where by state agencies will exchange a portion of their 9% tax credits to the Treasury Department for $.85 per tax credit dollar. While this exchange program will provide some stimulus, it is estimated that it will generate somewhere between $2.5-5 billion dollars in funding for improvements and repair. The bill provides separate funding for HUD’s Home program to state housing finance agencies.
- First Time Home Buyers – While the stimulus bill provides an $8,000 tax credit for first-time home buyers for homes purchased between Jan. 1 and Dec. 1, 2009, the tax credit phases out for individuals earning more than $75,000 and couples earning more than $150,000.