Can anybody point me to a respected economist (meaning one who isn't employed by the National Association of Realtors/Homebuilders) who thinks that extending the first-time-homebuyer tax credit is a good idea?
It's a bad idea on so many levels. Its regressive (homeowners are richer than the average taxpayer), its environmentally-unfriendly (homes are less efficient than apartments), and it does nothing but create artificial demand for a product that people have said they don't really want.
And in the latest incarnation it seems way too easy to game the system.
We've owned our house for more than five years, so if we sell it and buy another we'd qualify for the $6,500 existing homeowner tax credit.
It's awfully tempting to find somebody else who owns a similar house, and then swap houses. I sell to them, they sell to me, and we each pocket $6,500 dollars. If we were 100% honest (or worried about the IRS doing bed-checks) we'd actually pick up and move.
Maybe transaction costs on selling a house are high enough that this won't actually happen, or maybe the law is written so doing this is illegal.
But given the amount of fraud that happened the first time around, I bet there will be a lot of house swapping going on in the next year.