As we move further into 2011, the housing crisis still begs the question, “where is the bottom?” Overall the US economy shows subtle signs of growth, but as home prices continue to slide and qualified buyers seem to be holding on to their cash, many still perceive the housing sector as being depressed. If you take a closer look, however, there is positive movement and specialists continue to point to programs that could aid in a recovery.
In 2011, optimism can be found in the options. From record low interest rates to government sponsored programs, buyers have many options to improve their purchasing power. Recognizing that the condition of the real estate market plays a critical role in the overall health of the economy, the government is getting creative with programs to remedy the imbalance of “homes for sale” versus qualified home buyers. Too much inventory has plagued the real estate market for several years, so these programs are designed to encourage and enable prospective buyers to purchase that dream home.
One such program includes a bill introduced in the U.S. House of Representatives called H.R. 1526 – the Housing Recovery Act of 2011. This bill would waive early distribution penalties on certain qualified retirement plans if the funds are used to buy a house that been in foreclosure for a year or more. The bill would apply to distributions from Roth IRAs, 401(k) plans and company pension plans. The distributed funds would need to be used within 120 days of receipt by buying a foreclosed property and the purchaser must agree to hold the property for at least two years to be exempt from early retirement plan distribution penalties. In theory, this program is not a “fix”, but reducing the inventory of distressed homes could lead to quicker stabilization of the housing market.
The real estate landscape is changing and that means this is a great time to investigate your buying or selling options. Understandably navigating the ins and outs of these decisions can be overwhelming, so potential buyers or sellers should work with skilled and experienced real estate agents that thoroughly understand all available options.