Housing Giants - August 25, 2008 - (Page 11) “NAHB fought hard to get that extended through the end of June 2009. But clearly, the tax credit will have its biggest impact in the existing home market, where it should help break the log-jam that’s created huge inventories of homes on the market.” The multiplier effect of the tax credit should benefit move-up builders, probably in the second half of 2009, as stabilizing home prices and tax credit-induced sales in the existing home market bring shoppers back into model homes in the move-up market. But if you want to actually use the tax credit to sell new homes, get cracking now. It will mostly impact sales this fall, not next spring. The clock is ticking toward that deadline for June deliveries, but established entry-level builders could have big sales this fall. —Bill Lurz Want the basics? Read HUD’s FAQ page for a rundown of the what the Housing and Economic Recovery Act of 2008 entails. Fast numBERs: $1 Billion As if Technical Olympic USA didn’t have enough problems with its Chapter 11 bankruptcy reorganization, the company has run into an expensive delay — a $1 billion one. The company-secured lenders are facing complaints of fraudulent lending practices from unsecured creditors. The complaints allege the lenders forced certain TOUSA subsidiaries to unfairly guarantee about $800 million in debt related to the company’s Transeastern Homes joint venture. The International Monetary Fund estimated in late 2007 that losses on U.S. assets from the subprime crisis and the subsequent fallout would be about $1 trillion. The organization is sticking with this number despite the U.S.’s recent major banking problems. 8.25.08.Housing giants 11 $1 trillion www.Housinggiants.com http://www.tousa.com/ http://www.imf.org/external/index.htm http://www.housinggiants.com
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