JEFFERSON CITY, Mo. – The Missouri Realtors have thrown their support behind a bill they believe will help new homebuyers have the financial capability to purchase houses.
The First-Time Home Buyer Savings Account Act, offered by Sen. Caleb Rowden and Rep. Becky Ruth, would create a new kind of savings account intended to be used to finance their first home. Individuals or families would receive a 50 percent tax deduction based on what they contribute to this account.
Individuals could invest up to $16,000 and families could save up to $32,000 per year, meaning deductions of $8,000 or $16,000 a year respectively.
Sam Licklider, the lobbyist for the Missouri Realtors, says these accounts will help young people find ways to save up and handle one of the most difficult hurdles for a first time homebuyer.
“One of the biggest problems we’ve seen in buying a house is coming up with a down payment,” Licklider said. “Young people coming out of college typically have $30,000 to $80,000 in student debt. Lots of times they get a great job, but they have debt and they don’t have any savings.”
So, Licklider says with this bill, prospective and hopeful homebuyers could open a First-Time Home Buyers Savings Account, set aside a few hundred dollars each month in the account and use it to buy a home with a significant discount on taxes due to placing money in that account.
Rowden added the idea is not just for people coming out of college.
“There’s people in my level, who are 30 to 35, been married a while, who still aren’t owning homes,” Rowden said. “I think there’s value up and down the board and it will provide benefit to the communities, and a benefit to the economy that far outweighs what is a relatively-speaking pretty small fiscal impact to the state.”
Rowden also saw the bill as a way to help the working poor and middle class alongside other economic programs like an earned income tax credit, a bill he is also carrying, and social impact bonds.
