In a word, it has to do with housing.
The plan: Part of the anticipated economic stimulus plan is likely to include provisions of a “Fix Housing First Homebuyer Tax Credit” bill introduced by U.S. Sen. Johnny Isakson of Georgia.
Would increase the current $7,500 home buyer tax credit to somewhere between $10,000 and $22,000, and apply it to home purchases between April 9, 2008, and Dec. 31, 2009.
Would be available at closing for use as a down payment. Repayment would be required if the home were sold within three years.
Low rates: Another component of the proposed plan would provide qualified home buyers with 30-year fixed-rate mortgages at 2.99% until June 30, 2009, and at 3.99% on closings between June 30 and Dec. 31, 2009.
An economic analysis by The Fix Housing First coalition shows that adding these housing stimulus provisions would, over four years:
• Increase GDP by 1 percent annually
• Create 940,000 new jobs annually
• Increase average homeowner equity by $25,000 by 2012
• Increase aggregate homeowner equity by more than $2 trillion by 2012
• Generate revenues at federal and state levels that will exceed the program’s cost
These economic improvements should also help homeowners who wish to invest in necessary home repairs, upgrades, additions, etc., based on their increased equity.