In the State of the Union, President Biden laid out a new plan to make homeownership more accessible for first-time buyers. Here’s what it could look like.
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In his State of the Union address on Thursday night, President Biden announced a set of proposals aimed at making homeownership more accessible to first-time homebuyers. These proposals include generous tax credits, down payment assistance for first-generation homeowners, and a plan to increase the number of available homes on the market.
“These proposals are directly aimed at helping people who have missed out on the generational wealth of real estate, helping them to get into homeownership, which provides more benefits than just wealth,” says Dan Green, CEO of Homebuyer.com. “There are social benefits to that as well.”
If implemented, these proposals could make homeownership substantially more affordable for the millions of Americans who are currently shut out from owning a home due to the high upfront and ongoing costs. If you’re thinking about buying a home, here’s how Biden’s plan could help you.
Biden called on Congress to pass a new tax credit that would put $5,000 per year in the pockets of middle-class households buying a home for the first time. Eligible homebuyers would get this tax credit for two years, meaning you could get a total of $10,000 in tax credits for buying a house.
The aim of this proposal is to reduce the strain homebuyers are currently feeling due to decades-high mortgage rates.
High mortgage rates have also kept many would-be sellers in their homes in recent years.
As mortgage rates have gone up, many households have remained in the home they bought when mortgage rates were much lower, hesitant to trade their current mortgage payment in for one that’s much higher.
This proposed tax credit aims to coax these individuals out of their homes, freeing up supply for new buyers.
