Real Estate Journal Online

While real estate investors often get the short end of the stick when it comes to getting blamed for today’s economic conditions, even the federal government acknowledges that the market simply won’t recover without those investors. As a result, there are myriad tax credits out there to “lure” real estate investors into community development projects, just as one called the New Markets Tax Credit that provides double-digit tax returns (in some cases) to investors who put their money in “underserved property sectors and underserved geographic locations” – meaning poorer, urban areas in most cases[1]. And although many of these credits have been around literally for decades, they are now being promoted more heavily than ever in order to encourage investors to enter the “revitalization” game.

And unlike the homebuyer tax credits, which many analysts argue actually hurt the housing market in the long run, these tax credits make it advantageous for investors to develop and even hold properties in many hard-hit areas of the country. Do you think that these types of tax credits are good for the real estate market, or should the government just stay out of housing?

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