House hearing on first time home buyer tax credit

Testifying before the Committee, the National Association of Home Builders (NAHB) Chairman, Joe Robson, a home builder from Tulsa, Oklahoma supported the extension stating that Congress should take quick action to extend and enhance the $8,000 first time home buyer tax credit. He added that "To create jobs and put the housing market and the economy on sounder footing, [the] NAHB is urging Congress to extend the credit for an additional year and to make it available to all purchasers of a principal residence."

In a statement supporting the extension of the tax credit, the Mortgage Bankers Association said, "As we approach the end date of the current $8,000 tax credit, we urge Congress to expand the program to include all home buyers, increase the credit up to $15,000, make the funds available for closing, and extend the overall program by at least 12 months."

The first time home buyer tax credit was signed into law in the summer of 2008 and was intended to provide a bounce to the struggling housing market.  The credit provides first time home buyers with a $8,000 tax credit and this provision is set to expire on November 30th of this year.  Some experts have said the tax credit will account for an additional 350,000 home sales.

Committee Chairwoman Nydia Velazquez (D-NY) said that for many small businesses in the housing sector measures like the first time home buyer tax credit have been a "lifeline." She added "That $8,000 incentive has galvanized consumers, sparking an increase in home purchases."

Committee Ranking Member Sam Graves (R-MO) commented after the hearing, “While small businesses continue to battle the downturn in the housing market, small lumber mills, contractors, and realtors have seen relief from this tax credit. ”