Feb 3, 2021
By Beth Wanless, Director of Government Affairs
Yesterday (Feb. 2, 2021), Ohio REALTORS testified before the Ohio Senate Ways & Means Committee to urge passage of Senate Bill 24, the First-Time Homebuyer Savings Act. Ohio REALTORS President Seth Task and Michelle Billings, Chair of the Legislative Steering Committee, each shared their professional expertise and compelling arguments for the creation of First Time Homebuyer Savings Account in Ohio.
“Ohio REALTORS strongly supports SB 24 as we believe this savings tool will help Ohioans who are interested in owning a home someday realize the American Dream,” Task testified. “Although this savings program will not reduce all barriers to homeownership, it is certainly a tool that will help hard-working Ohioans move closer to their goal. We believe Senate Bill 24 is a reasonable approach to the home-buying process for first-time buyers. Senate Bill 24 would promote financial literacy through saving over the course of several years to achieve the American Dream of homeownership. A person is rewarded for their long-term commitment to save for a home with a small tax benefit that would add up over the years.”
SB 24, introduced 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 purchased in Ohio. A “first-time homebuyer” is defined as someone who has not purchase or owned a home within the past three years. Although a person can put as much money as they want into the savings account, 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 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. It also includes an exemption for active-duty military personnel to not be penalized if they’re called to duty out of Ohio, and they need to either move or be out of the state for extended timeline.
Billings spotlighted the significant benefits derived from a home purchase.
“We need the First-Time Homebuyer Savings program in Ohio, as we need to help all Ohioans be as prepared as possible to make the biggest, and arguably best financial decision of their lives,” Billings said. “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 to change the color scheme of their new home, or hire plumbers and electricians to repair something. 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.”
Task reiterated that point during his testimony.
“The average home purchase in Ohio put more than $55,500 back into the state economy through construction, home-related expenditures, home improvements, and income generated from the real estate industry,” Task said. “Homeownership is good for all of Ohio.”
As the bill moves through the legislative process, Ohio REALTORS will be sure to update you.