Builder Magazine reports that the U.S. House of Representatives have just passed a bill that will provide up to $7500 in tax credits to first time home buyers. The bill also provides a plan for struggling homeowners to refinance their loans through FHA, so long as their current lenders reduce the principal amounts owed.

I'm typically not a fan of bailouts, but tax credits are a great vehicle for stimulating activity. I guarantee that for every house I build, it generates far more than $7500 in federal income taxes. Using rough numbers, I calculate a typical $200K home to generate nearly $18K in federal income taxes alone, which still nets over $10K in tax revenues it may not have otherwise received. It's difficult to argue against that idea.

The bill must receive some tweaks in committee before making its way to the President's desk for signature. Unfortunately, he has pledged to veto the bill. Thanks, G-dub.