The U.S. Department of Housing and Urban Development announced today that first-time home buyers can use the $8,000 tax credit toward down payments on FHA-insured homes. Although the change has been talked about for weeks, today’s announcement made it official. “We believe that this could boost new home sales by 20 percent to 30 percent, which would match the declines builders anecdotally reported when DPA was eliminated last fall,” said Lisa Marquis Jackson of John Burns Real Estate Consulting.
This could have a huge impact to the move the industry, she says, particularly at the lower-end of the housing market. She also noted that home builders report 70 percent of their loans are through FHA.
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