Tuesday, Sept. 1, 2009 | 2:07 a.m.
The ravages of a deep recession have made it difficult for the battered housing market in Las Vegas to recover. Foreclosed homes have flooded the market, and there is little indication that a sustainable rebound in sales of new and existing homes can be achieved without further help from the federal government.
That is why we urge Congress to extend the $8,000 tax credit for first-time homebuyers beyond its scheduled Dec. 1 expiration.
As reported Saturday in the Las Vegas Sun by Brian Wargo, the extension of the tax credit is supported by both the Southern Nevada Home Builders Association and the National Association of Home Builders.
David Crowe, chief economist for the national association, was on target when he told the Sun: “We need this credit to keep the fragile recovery from falling backward.”
We are not as enthusiastic about a proposal by homebuilders to extend the tax credit to all buyers, because that could lure reckless speculators known as “flippers” back into the market. But there are many reasons why Congress should continue those credits for first-time homebuyers.
One is that it would help stabilize neighborhoods that have experienced high foreclosure rates and deteriorating property conditions. Tax credits would also stimulate the local economy by producing more jobs in real estate, retail sales and home-related services.
Congress, in fact, could help spark a swifter housing market recovery by increasing the amount of credits to as much as $15,000, as many Realtors advocate.
It would be preferable for the housing market to correct itself without government help. But that is not realistic in Nevada, California, Florida and other states with high foreclosure rates.
The expiration date to remain eligible for the tax credit is quickly approaching, yet there is little evidence that depressed housing markets in those states will recover anytime soon. Congress should extend the deadline because healthy state and local economies depend on strong housing markets.
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