President Biden announced a plan to fix America’s housing crisis in his State of the Union address on Thursday, which includes tax credits that may make it possible for families in California to consider purchasing a home — even with the state’s high median prices. Gordon Tokumatsu reports for NBC4 News on March 8, 2024.
President Joe Biden announced a plan to fix America’s housing crisis in his State of the Union address on Thursday.
Biden’s plan includes a $10,000 tax incentive for first-time home buyers and another $10,000 in tax credits to encourage current owners to sell their homes, all in an effort to put home prices back in reach for both for the first time in years — but can it work in California?
NBC4 spoke with Habitat for Humanity President and CEO Erin Rank, whose organization knows all about California’s housing challenges — including high median prices that leave families unwilling or unable to buy.
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“Families used to be able to buy a house for somewhere near what equaled one year’s income,” Rank said.
According to Rank, the tax credits address at least one crucial problem after the COVID-19 pandemic and inflation drove interest rates so high that the markets skidded to a halt.
“I think this tax credit might be enough of an incentive to move them off the sidelines,” Rank said.
Rank also said the plan’s “Down Payment Assistance” portion will also help families consider purchasing a home, since writing that first check is often the most daunting part of buying.
But concrete solutions have to include California’s supply and demand problem, which Rank said Biden’s proposal will address if Congress gets on board.
“There just simply are not enough houses for all the people who live in Los Angeles and throughout California,” Rank said.
If adopted, the plan could eventually benefit renters as well — more housing means more choices for them, and landlords would not be able to charge as much.
