In the United States, the GDP recorded 3.5% growth in the third quarter – for the first time in since the end of 2008. Furthermore, the once-ailing housing market has shown great improvements since last winter.
Is the United States finally on the route to recovery? Right now, the US property market is working with 7.5 months’ supply of merchandise. While this may sound alot, consider the fact that in January of this year the housing stock was at a massive 12 months plus. Anybody looking to acquire a home and the real estate agents are closely following the first time home-buyers’ tax credit.
The tax credit accessible has been a great incentive in advancing the US housing market when potential buyers could receive up to $8,000 in tax credits or cash back. But as the expiry time limit for this special offer comes nearer, market watchers are becoming nervous. What will happen once the tax credit is no longer on the table?
Lawmakers have already prepared an extension bill, which hopefully will push the time limit further to the year 2010. The next step after the Senate cleared the way is for the bill to be given to Obama, probably within the next week or two. Not only is the deadline about to be extended till April 30, the allowable income threshold for couples will also rise to $225,000. And that’s still not the end – a new $6,500 tax credit for move-up homeowners was affixed to the bill.
Passing this bill may fuel our southern neighbour’s housing market enough to get through the winter, still, the question remains: how will the US federal budget sustain this hit?
