Also in this playlist...
This transcript is automatically generated
Well home prices and sales are starting to show some improvement.
Putting tax threat credit for first time home -- to set to expire in just a few months will this hurt the fragile housing market and is there any hope it might be renewed.
Joining us for a Fox Business.
It was Jim Gillespie PC EO of Coldwell Banker is what -- One came to -- that Alexis to add that to be back thanks for asking me all right so first and foremost that we'll explain to people are currently there's an 8000 dollar tax credit for new home buyers -- -- that set to expire.
-- it's gonna expire November 30 so that deadline is coming very very quickly in the real estate market even though we've seen a couple signs over the last couple months is still.
Not sustainable for long term.
We've got very strong investors in the market -- are taking advantage of great buys.
You've got the first time home buyer tax credit which has worked.
But what is not.
In the market right now is to move up buyer.
The move up buyer is absolutely critical to a long term sustained real estate recovery OK I was aware what we're doing what we're asking for is 151000 dollar.
Tax credit for all buyers have primary residences for a period of one year with no income camps.
OK so would go up to go back here 12 which is the move up buyer -- -- assumed that the person is gonna trade up from a smaller home to a slightly larger problem.
Yes exactly and typically the move up buyers -- 6570%.
Of the market right now the move up buyer.
Is arguably maybe half of the market.
To right now this year we're gonna have between forty -- and five million resales in the country.
And depending on the months anywhere from.
35 to 45%.
Of the sales are to investors and first time homebuyers.
So the move up buyer is absolutely critical as you know real -- is -- our country out of every downturn.
And every recession since the 1950s.
And I mentioned before.
And interviews with you that every time homes sold in this country 63000.
Of economic activity is put into that local economy.
And according to Harvard 21% of the gross domestic product in our country is real estate and housing related so.
It's critical to get to -- real state going.
You mentioned about forty half million give or take in resales -- year.
Put in context for me how does that compare to the PQ what do we need to see that rise up to without.
You know sheriff -- and.
Absolutely -- and a gag and that's a very good point.
2005 was a record year seven point one million resales in this country I don't know -- we're gonna see numbers like that for.
Thirty years but based upon the number of households in this country.
The run rate for homes sold in this country should be somewhere around five and a half million.
So there's no way we're gonna create an artificial demand because there's so much inventory out there.
And the foreclosure situation is going to continue.
To get worse this year foreclosures will be.
Probably over three million according to realty track last year there were 2.3 and 2.3 million and these -- foreclosure filings and next year we're looking at larger numbers so.
We need to have a stimulus to get real estate going which we'll get the economy going.
Interesting consenting to when he came here they Greenspan made some comment -- -- on Sunday and This Week with George Stephanopoulos they basically have -- the danger here.
Is it real estate prices decline another 5% we could have a second double debt.
What he -- -- 8000 dollar tax credit per individual new home buyer costing the country.
You know costing us -- government's pocket and what -- that 151000 dollar credit picture proposing.
Cost us for one year.
Well the 151000 dollar tax credit would cost 36 billion dollars according to -- aren't -- what my Mark Zandi says.
An independent federal agency says it'll cost.
39 billion dollars but you need to remember Mark Zandi.
They shared with us that there will be a return on that member of the 63000 dollars I talked about that goes into the local economy there will be over 33 billion dollar.
Positive return on the gross domestic product in this country according to Mark Zandi who's I think one of the the -- best economists in our country in the country yes.
So was so right now this 8000 and her new home buyer how much they allotted in total to this program.
I don't have the exact numbers on that but based upon a 36 billion dollar price tag for the 151000 dollars it would probably be somewhere around.
Half of that yes.
-- -- -- -- It's the worst I've ever seen -- so -- since the Great Depression this is the Great Recession and real estate really has has been this actually is -- August marks the the beginning of the fifth year the real estate downturn and of course we're in the 21 month of the year recession for the country.
And again like I said before real estate is vital.
You'll -- is vital to the recovery.
And the thing about -- is if we can get the move -- -- back in the marketplace we'll start to burn off.
Inventory prices will level off start to go up.
And then the good news there is that that's gonna forestall this -- -- situation that we're looking at for the next eighteen months so by doing this it helps both stands at its demand.
Its economy going.
And it helps with foreclosures by stabilizing and raising prices -- it's always -- -- physical -- -- -- really put things in English and -- that we can understand I thank you so much and hopefully we'll make some progress I hope so.
Filter by section