During the new year, we all waited in anticipated breath on news about the fiscal cliff. As the rest of the world immersed themselves in the holiday festivities, the US government, including the President, worked to help avert this particular problem.
Just to give you a brief background, this particular cliff involved the removal of several government aids that were put into place to help struggling citizens deal with their own financial woes. These government supports resulted in a lot of forgiven debt that enabled consumers to pick up the pieces of their shattered lives after losing their jobs. However, that aid came with a price. The government absorbed these losses by increasing their budget – resulting in a relatively high spending that exceeds the revenues that they earned.
This fiscal cliff became a threat to the slow recovery of the Us economy. Experts are saying that although the recovery is there, this change in the budget deficit may cause the whole thing to collapse once more. It posed as a serious concern for all investors – especially in the real estate industry. Just as homebuyers are starting to get confident, will it shatter once more?
It was only in recent years that the country was able to get out of the slump and the real estate industry had been showing positive signs. But with this cliff, people are more hesitant than ever to purchase their own homes – even with the low mortgage interest rates.
Good news is, the US government worked overtime to meet and come up with a deal that will avert most of the negative impact of the fiscal cliff. Now we are hearing news that the cliff will not affect the middle class income taxes. Not only that, the benefits of the unemployed will continue to be in effect – providing much needed support to the millions of Americans still struggling to find a decent job.
Last week, there were reports that even the housing recovery will be unharmed. The US Congress agreed that the tax deductions on mortgage insurance will continue to be provided. This included debts erased through loan modifications and short sales. It also left the deduction on the mortgage interest all in one piece.
The latest news on the fiscal cliff deal left the real estate industry in relief as it seems that the 2012 comeback will continue to rise all throughout 2013.
The officials who tirelessly worked to find a solution evidently understood the effects of a strong real estate industry. The recent recession showed just how much the housing collapse affected the local economy as a whole. Just as the housing market spiraled the economy to the slums, it seems to be the major contributor in its overall reconstruction as well.
The new fiscal cliff deal prioritized funds for the real estate industry by giving the tax break an extension this 2013. However, you need to know that this does not extend to refinanced mortgages.
The deal also impacts States differently. So if you wish to know more about this important chapter in the US fiscal history, you need to get in touch with a real estate company who can explain it explicitly.
The Guldi Group will be more than happy to provide answers to any confusion that you may have on the fiscal cliff. Give us a call we we would be happy to answer your questions. If you are wondering if now is the time to buy a home, the answer to that is a resounding yes. And we can definitely help you with that.
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