Ohio REALTORS back passage of First-Time Homebuyer Savings Act
Mic Gordon, vice chair of the Ohio REALTORS Enlarged Legislative and Legislative Steeering Committees, testifies in support of the First-Time Homebuyer Savings Act before the Ohio Senate Ways and Means Committee.
A top legislative priority for Ohio REALTORS, a bill to establish a First-Time Homebuyer Savings Act in the state, was the subject of a third hearing yesterday before the Ohio Senate's Ways & Means Committe. Columbus REALTOR Mic Gordon, vice chair of Ohio REALTORS Enlarged Legislative and Legislative Steering Committees, testified in support of Senate Bill 139, noting that the "savings account would be a tool in (a first time buyer's) toolbox toward the purchase of a home."
SB 139, sponsored by Sen. Theresa Gavarone (R-Bowling Green) and Sen. Bob Peterson (R-Washington Court House), would authorize a first-time homebuyer to open a tax-deductible savings account in which a person can deposit money with the goal of using it toward a down payment of a home. A “first-time homebuyer” is defined as someone who has not purchase or owned a home within the past three years. Further, although a person can put as much money as they want into the savings account, only the interest earned and capital are deductible with annual limits of $5,000 for single filers, and $10,000 for joint filers. There’s a lifetime deductible cap of $50,000 for single filers and $100,000 for joint filers. The money must be used toward the purchase of a home including closing costs and bank fees within 15 years or a 10 percent penalty may apply. Anyone can open an account, and an account holder can have an account for themselves or for another person, such as a child, or grandchild.
In his testimony, Gordon stressed that the bill is important to REALTORS, and to many Ohioans who dream of owning their first home. Other highlights from Gordon's testimony:
"According to a 2018 study by the National Association of REALTORS the Ohio real estate industry accounted for 15 percent of the gross state product in Ohio. The study also found on average each home purchase contributes $50,360 back into the Ohio economy. When I help my clients find that special place to call home and they close on their new home, many of them turn around and spend money to upgrade appliances, hire painters, hire plumbers and electricians. Buying a home creates many more jobs than just the people helping with the transaction. Real estate keeps Ohio moving forward in a very big way and, as a REALTOR, I’m proud to play a role in this process and contribute to Ohio’s economy.
"Yahoo! Finance just recently posted an article from Money Magazine noting that using a First-Time Homebuyer Program in a state that offers it is an excellent way to save towards a home if you cannot expect financial assistance from a family member. These accounts can and will be used by all types of Ohioans.
"One of the best aspects of this bill is that having a First-Time Homebuyer account is completely voluntary. Individuals can use their personal discretion to decide what is best for them, and how to save and spend their hard-earned money. If indeed they do want to buy a first home someday, they can choose to open a First-Time Homebuyer Savings account and save as much as they feel is within their budget.
"I believe Ohio is a fantastic place to live, work, and play. The Ohio REALTORS believe the creation of a First-Time Homebuyer Savings account will build off the good policies the Ohio Legislature has already worked on to continue to make Ohio an attractive place to live and conduct business. Hopefully my daughters will use an account like this toward the purchase of their first home, and most importantly stay close to family and build lives in Ohio as well."
The Senate Way's and Means Committtee will need to conduct a fourth hearing before the bill can be voted out of committee.