Knoxville Tennessee Real Estate Blog

Image via WikipYesterday at the National Association of Realtor’s (NAR) annual convention in Orlando, Florida, NAR proposed their own economic stimulus plan to get the nation’s economy moving again.

Not surprisingly it involves real estate, more specifically residential real estate.

Increasing home affordability and access to reasonably priced mortgage loans would help other business as well because each home sale drives the purchase of many other goods and services.

“New homeowners move into a home with energy and enthusiasm, spending money on everything from appliances, to furniture, window treatments, and rugs. New homeowners tend to want to make the home their own, and spend a great deal during the first two years in a new residence making improvements, from cosmetic changes such as a new coat of paint to major renovations such as room additions.”

I know that when we bought a new home in 2007 we spent quite a bit of money doing improvements. We:

• painted the interior
• Added insulation in the attic
• Rebuilt all the closet shelving with vinyl coated shelving systems
• refinished the hardwood floors
• remodeled both bathroom
• Replaced the single pane windows with new, insulated low-e glass
• bought new blinds for all windows
• did quite a bit of new landscaping
• Upgraded the electrical service

And each one of those purchases put several thousand dollars into Knoxville’s economy which enabled the local goods and service providers to pay their bills, buy their own consumer goods and services, and make capital investments to grow their business.

NAR’s 4 point proposal is as follows:

1. Extend for 2 years the current $7,500 tax credit for first time homebuyers, make it applicable to all buyers, and eliminate the repayment requirement.
2. Make permanent the temporary increase in FHA, Fannie Mae and Freddie Mac loan limits to $729,750 in high-cost areas. The limits are scheduled to roll back to $625,000 on Jan. 1.
3. Permanently block banks from engaging in real estate brokerage and management.
4. A temporary federal buy-down of mortgage rates to 4.5 percent or less. We feel mortgage interest rates are too high by roughly 200 basis points (100 basis points equals 1%) and the temporary buy down would encourage buyers currently sitting on the fence to go forward with their purchase.

With or without the stimulus proposal there are some great buys in resale and new homes all around the greater Knoxville, Tennessee area. Take a look at KnoxvilleHomeCenter.com to see for yourself.