During an Oct. 23 conference call, Pulte Homes CEO Richard Dugas called for a home buyer credit of $20,000 or more to replace the $7,500 new-home buyer tax credit currently available from Uncle Sam. So Big Builder set out to determine if this reflected the opinions of its readership as a whole.
Turns out, it does.
Out of a total of 34 respondents, 79.4% said they thought a $20,000 credit would do more to spur sales than the currently available $7,500--which hardly comes as a surprise. Yet others weren't so sure, with 11.8% of respondents stating the increased amount would not do more to spur sales and 8.8% remaining unsure.
As one respondent in the Florida market said, "The $7,500 did nothing for me in Tampa. I'm not sure throwing more money at people would create a greater sense of urgency; in fact, it may seem like we're panicking and could possibly create more doubt in the mind of home buyers."
In addition, Dugas suggested that this increased tax credit should not have a repayment provision, unlike the current $7,500, which essentially amounts to an interest-free loan and not a true credit; 88.2% of survey respondents agreed that such a move would help to move inventory, while a mere 2.9% disagreed and 8.8% were once again unsure.
As one explained, "It doesn't matter. This isn't the way our government is supposed to work. This is an economic cycle that America needs to move through. Trying ot manipulate this thing will make it worse in the long run. Did we not learn from the Great Depression the 1930s? Folks need to bear down and face this on their own. Politicians have gotten us in this mess, and, as citizens, we need to be more aware of what our politicians are doing and make them accountable for their actions. But we certainly don't need any more bail outs from our government."
When asked if Dugas' call for the increased credit to be made available to all home buyers, as opposed to strictly first-time buyers or buyers of new homes rather than existing, an overwhelming 90.6% of respondents said yes.
"Homeowners like to move up when it's affordable, and this would be helpful," noted one respondent. "Also, they have shown they are dependable--why should they not qualify as well?"
Reader response was positive with respect to Dugas' suggested temporary mortgage rate buy down of between 150 and 200 basis points, with 85.3% agreeing it would encourage prospective buyers to purchase a home, while 8.8% disagreed or were unsure, respectively.
Yet even some of the plan's supporters retained a healthy amount of skepticism. As one respondent explained, "This would be the best scenario. But buyers are scared right now, and the media's constant barrage of doom and gloom certainly isn't helping anyone."
"The general public does not fully understand the trickle-down effect the home building industry has on other industries such as furniture, trucking, interior design, etc. The more we can do to recover and assist those who can afford and qualify to own their own home, the better off the economy will be."