Mortgage Debt Relief Act Extended for 2013
Well after what seemed like a never ending bad movie, the Fiscal Cliff has been averted and the Mortgage Debt Relief Act of 2007 has been extended into 2013. I am not a big fan of politics, and the lack of progress I saw last week as the year ended, reaffirmed my dislike on how business gets done (or not) in Washington DC.
The Tax Relief Extension Act, HR 8, was passed by the Senate early on Jan 1st and the House followed by passing the bill late into the evening the same day. This bill has several components for taxpayers in the US. For Homeowners and Real Estate agents the key tax advantages of home ownership and specifically the extension of the Mortgage Debt Relief Act are positives for the rebounding housing market.
In our market (San Diego, Los Angeles) approximately 30% of all the closing in the last three months have been distressed sales. It would have been difficult to predict, what might have happened if this key legislation had expired. With low interest rates, low inventory and many former homeowners who lost their properties in 2008 and 2009 due to foreclosure as potential new home buyers, we may see a very strong and healthy Real Estate Market in Los Angeles & San Diego.
In conclusion, the extension of the Mortgage Debt Relief Act of 2007 and the current demand for properties and our low inventory levels, are setting the stage for a very active and healthy Real Estate Market for 2013.(Kouran Jouldjian-author)