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Maloney Introduces Bill to Help First-Time Homebuyers Amid Pandemic Economic Recovery

Jul 21, 2020
Press Release

Maloney Introduces Bill to Help First-Time Homebuyers Amid Pandemic Economic Recovery

Washington, D.C. – Today, Rep. Sean Patrick Maloney (NY-18) introduced the First Time Homebuyer Pandemic Savings Act, a new bill that will help first-time homebuyers realize their dreams of homeownership, during and after America’s recovery from the coronavirus public health and economic crisis.

“Making sure the next generation of homeowners have the resources they need to buy their first home is going to play a big role in our economic recovery. This bill is a smart, innovative way to bring new opportunity to new homebuyers and help young families get one step closer to realizing the American dream,” said Rep. Sean Patrick Maloney.

The First Time Homebuyer Pandemic Savings Act allows first-time buyers to withdraw funds from their retirement accounts under the umbrella of coronavirus-related distributions to assist with the purchase of a home. The bill would allow for up to $25,000 of the coronavirus-related distributions to be tax-exempt and penalty-free to be put towards the down payment of a home for new homebuyers. The bill would also extend the coronavirus-related distribution sunset clause to December 31, 2021.

The Coronavirus Aid, Relief and Economic Security (CARES) Act, which passed in March, created a new hardship withdrawal for Americans who invest in 401(k)-type contribution plans or individual retirement accounts (IRAs) for those impacted financially by COVID-19. The coronavirus-related distribution is not subject to the early-distribution penalty of 10 percent and can be repaid over three years. 

Home sales nationwide have sunk 15-27 percent across the country from pre-pandemic levels. First-time homebuyers make up 33 percent of all homebuyers and many fear a housing market regression is possible given the economic insecurity many first-time homebuyers may feel as the country recovers from the economic crisis caused by the pandemic.

According to new data from the Hudson Gateway Association of Realtors, Orange County home sales declined 26.5 percent this spring, compared to the same timeframe in 2019.