US: $10,000 Tax Credits For First-Time Homebuyers?

US President Biden is calling for a $10,000 credit for first-time homebuyers and also a $10,000 credit for people who sell starter homes.

This move by the Biden administration aims to un-freeze the housing market due to high mortgage rates and rising prices of houses. Biden will announce Thursday evening in his State of the Union address.

According to Biden’s proposal, first-time homebuyers receive a tax credit of $5000 for a year for two years. A second credit worth $10,000 for a year is for the people who sold their starter home.

However, the measure would have to pass Congress to become a reality.

Many homeowners secured mortgages during the pandemic with an average rate of 2.65% in a 30-year-fixed and now the rates are as high as 6.88%, according to Freddie Mac.

In addition to the tax credits, Biden is also asking Congress to authorize $25,000 down-payment assistance for first-time buyers whose parents aren’t homeowners.