California, Nevada and Utah homeowners were apparently the biggest beneficiaries of the First-Time Homebuyer Credit, though the rankings differed depending on the three flavors of the tax credit enacted by Congress in the past few years. Lets see how they stack up.
A new report by the Government Accountability Office noted that Congress enacted one version of the tax credit in the Housing and Economic Recovery Act of 2008 (the Housing Act), a second version in the American Recovery and Reinvestment Act of 2009 (the Recovery Act), and most recently a third iteration in the Worker, Homeownership, and Business Assistance Act of 2009 (Assistance Act).
Through July 3 of this year, the IRS reported that about 1 million claimants claimed $7.3 billion in interest-free loans through the Housing Act provision, according to the GAO. Those claimants will begin repaying their loans next tax-filing season starting in January 2011.
On top of that, approximately 2.3 million claimants claimed a total of $16.2 billion using both the Recovery Act and Assistance Act provisions. Of these claimants, about 1.7 million claimed about $12.1 billion using the Recovery Act provision That represents half of all claims, making it the most frequently used version of the FTHBC.
In addition, nearly 600,000 people claimed about $4.1 billion worth of credits using the Assistance Act provision. Of those folks, close to 400,000 of them claimed about $2.9 billion using the first-time homebuyer option, while nearly 200,000 claimed $1.2 billion worth of credits using the long-time homeowner option. Those numbers in particular are likely to increase because the IRS is still processing the FTHBC returns, and this version of the credit can be claimed on tax returns filed during the 2011 filing season, the GAO noted.
Now it gets a little more complicated when it comes to the comparative state rankings. The GAO noted that the rankings vary depending on the statistic used for analysis and may change as the IRS continues to process FTHBC returns. The three statistics the GAO selected total dollar amount claimed, dollar amount claimed per resident, and average dollar amount claimed per FTHBC claim illustrate how the results can vary.
California, the most populous state in the country, ranked in first place with the most FTHBC dollars claimed under the Housing Act provision, as well as under the combined provisions of the Recovery and Assistance Acts, according to the GAO. On the other hand, California ranked 32nd and 29th in the amount of FTHBC claimed per resident under the Housing Act provision and under the combined provisions of the Recovery and Assistance Acts, respectively.
Not to be outdone, Nevada ranked first in the amount of FTHBC claimed per resident under the Housing Act provision, as well as under the combined provisions of the Recovery and Assistance Acts. However, Nevada ranked a mere 26th and 24th in the amount of FTHBC dollars claimed under the Housing Act provision and under the combined provisions of the Recovery and Assistance Acts, respectively.
But both California and Nevada had some competition. Utah ranked first in the average dollar amount of FTHBC claimed per claim under the Housing Act provision, as well as under the combined provisions of the Recovery and Assistance Acts. Conversely, Utah ranked 29th and 30th in the amount of FTHBC dollars claimed under the Housing Act provision and under the combined provisions of the Recovery and Assistance Acts, respectively.
To see how your home state ranked in the competition for FTHBC claims, check out the report here.
Meanwhile, the Obama administration appears to be distancing itself from speculation that it will extend the credit. During an appearance Sunday on CNNs State of the Union program, Housing and Urban Development Secretary Shaun Donovan gave a non-committal answer when he was asked about whether the administration would push to extend the credit beyond its expiration date last April 30 after the dismal housing numbers that came out last week. Its too early to say after one month of numbers whether the housing credit will be revived or not, he responded cautiously (see White House Mulls Extending Homebuyer Tax Credit). However, that was enough to fuel speculation that the administration might be considering the idea.
Later in the week, the administration tried to tamp down the expectations, though. It is not high on anyones list that we have heard, Donovan said on Wednesday, according to Reuters. We have not heard Congress talk about renewing it.
Even Sen. Johnny Isakson, R-Ga., the former realtor who had pushed for the extension of the tax credit last year, appears to have backed away from extending it again. The tax credits provided an impetus that was needed at the time, he said, according to the Atlanta Journal-Constitution.
Now former backers of the tax credit want to see if the housing market will be able to bounce back on its own after it was artificially pumped up thrice by government intervention, until the balloon inevitably burst with the expiration of the credit. Apparently the last thing anyone wants right now is for potential homebuyers to hang back waiting for the tax credit to be revived once again.
But of course, anything can happen in Washington, and if the housing, construction and real estate industries again start pressuring lawmakers back home after a few more months of slack sales, they can certainly convince more than a few of their elected representatives to change their minds.