Image via Wikipedia

It has been almost a year since the last of the real estate targeted stimulus funds ended.  In fact, it was April 30th last year that contracts had to be written… with a June closing.

Interest rates were a touch higher than now… and sales were mixed compared to this year.  They were certainly up from the year before.

But there are some other VERY important facts to also consider:

• Values in most of the country, including Gwinnett County, GA, are down from last year…  +$8000 tax credit…  -$15000 in value.
• The government (taxpayers) borrowed about $17 billion for the rebates…
• Much of the money went to people that would have bought homes anyway…
• A good bit of the money went to people that weren’t actually eligible…

Maybe we should have just let the market work it out.  Maybe.

Here we are a year after the credits started to go away, and the market is showing signs of recovery… but the market tanked for a while immediately after the credits expired.  It would be VERY easy to argue that the reason the market is starting to turn is that prices have eroded further, not because of any lasting stimulation effect of the tax credit.

$17 billion here, $17 billion there… pretty soon you are talking about real money…