Builders Urge Congress to Offer Buyer Incentive to Spur Home Sales
- Jun 06, 2008
Horsham, Pa.–When Toll Brothers CEO Robert Toll suggested–during a company earnings report on June 3–that Congress needed to pass a bill granting home buyers tax credits to reinvigorate the real estate market and economy, he wasn’t alone.Toll–along with other builders–believes that if the government just approves billions in Federal Housing Administration loans or rescues homeowners whose home equity has fallen below their mortgage amount, home prices will keep falling, BusinessWeek reports.Congress instead needs to prompt consumers to buy homes–which, Toll said, it’s done before. In the mid-1970s downturn, Congress approved a home buyer tax break that rewarded buyers $2,000 for market activity.Toll talked to lawmakers about a similar incentive about six months ago–although he’s asking for $15,000. The National Association of Home Builders also has been proposing a tax credit since November, according to chief executive Jerry Howard.A form of buyer tax credit was included in both the House and Senate versions of the Foreclosure Prevention Act. The House bill would give buyers who haven’t owned a home in three years or more a maximum of $7,500 in refundable credits; the Senate version rewards buyers who purchase a foreclosed home with $7,000.The Senate plan also feature homebuilder tax benefits, which let builders charge current losses against the gains they’d earned during housing’s growth years. House and Senate negotiators are currently working to resolve the bills’ differences.