U.S. Sen. Johnny Isakson said there won't be another extension of his homebuyer tax credit after it expires in June.
In an interview with The Associated Press on Monday, Isakson said a second extension "isn't going to happen." The Georgia Republican and former real estate agent said the extension signed into law earlier this month by President Barack Obama "will not work at its fullest unless it has a termination date."
The U.S. Senate voted earlier this month to extend an $8,000 tax credit for first-time homebuyers which had been set to expire. Isakson was the architect of that tax break. The new plan was expanded to include a $6,500 credit for existing homeowners who buy a new place after living in their current residence for at least five years. The credit will be available through next June as long as the buyer signs a binding contract by the end of April.
Isakson said making existing homebuyers eligible for the tax credit will provide a needed boost to the housing market.
"I have said from the beginning, unless you move it across the market you're never going to catch the 'move up' market, where the most home equity is," he said.
Isakson said existing homeowners persuaded to enter the housing market will help move homes that have been languishing with "for sale" signs on their front lawns. Once those homes move, the construction industry will perk up, he said.
There have been signs the tax credit is working.
The National Association of Realtors reported on Monday that home sales surged for the second month in a row in October, climbing to the highest level in 2 1/2 years. Home sales nationwide are up almost 36 percent from January, although they are still 16 percent below the peak in autumn 2005.
Isakson has received some $530,000 from the real estate industry since 2005, according to records compiled by the Washington-based Center for Responsive Politics. The campaign finance group said it is the largest sector which has contributed to Isakson.
Isakson was skeptical on Monday of the effect the $787 billion federal stimulus plan has had recharging the economy. Isakson voted against the plan and said that it has done little to replace the 317,000 jobs Georgia has seen disappear since the recession began.
The Obama administration estimates that the stimulus has saved or treated about 30,000 jobs in the state, he said.
"At that rate it would take us 10 years to get back to full employment," Isakson said.
Isakson is seeking a second term in 2010. The only Democrat who has said he will run against him is R.J. Hadley, a lawyer from Rockville County who has never held elected office.