WASHINGTON - Democratic congressional leaders are working with the White House to extend an expiring $8,000 tax credit for first-time home buyers, and aides said yesterday that they were considering making it available to current homeowners who purchase a new residence.
Extending and possibly expanding the popular credit, which is due to expire after November, are high among options for further stimulating the economy and creating jobs, congressional aides said, though a White House official said it was only briefly mentioned yesterday in a meeting among President Obama, House Speaker Nancy Pelosi of California, and Harry Reid of Nevada, the Senate majority leader.
The Democratic leaders met with the president to discuss a broad range of options to combat high unemployment, officials say. Two other components of the economic safety net - extended unemployment compensation and health care benefits for those who have been out of work for long periods - will expire at the end of the year.
Besides the likelihood of extending those measures, the president and Congress were also considering additional steps, given projections that jobs will continue to be lost into the middle of next year despite signs of economic recovery, possibly driving the unemployment rate above 10 percent. But they insist that any package will not add up to a second stimulus package, a prospect that would invite Republicans’ attacks on the effectiveness of the first.
Keeping the home-buyers credit and broadening it has been a priority for real estate agents and the home builders lobbies, and for Reid, who faces a tough reelection race next year in a state that has been among the hardest hit by the housing crisis since mid-2007. Reid said the government should “continue efforts to strengthen the housing market by extending the home-buyer tax credit.’’
By the time it is scheduled to expire, the home-buyers credit will be responsible for nearly 400,000 sales of new and existing homes, out of total sales of 1.4 million, said Mark Zandi of Moody’s Economy.com.
