With Barack Obama entering the White House, his $787 billion economic stimulus plan was signed into a law. This stimulus plan included a tax credit  plan for the qualified first time home buyers.
To provide a significant boost to the real estate market, and bring the buyers back into the market, the US Senate passed the tax credit stimulus plan for the first time home buyers. The stimulus plan
aims to bring recovery to the ailing housing sector. The proposal enables a $8000 tax credit to first time home buyers. This amount has been capped to $8000 which is equivalent of 10 percent of the purchase price of  home. Again this applies to the first time home buyers and principal residencies.  This tax credit is not needed to be paid back unlike other credit plans.

Industry groups have welcomed and pledged support for the first time home buyer tax credit. This bill is estimated to cost around $32 billion over one year. The only concern at this stage is funding for this initiative.
First time home buyers should purchase a new or resale home on or after Jan 1, 2009 to be eligible for this credit plan. Further, the law defines the first time owner as a purchaser who has not owned a principal residence during the three year period before this purchase. This credit is refundable for the home buyer credit can be claimed even if the tax payer has no tax liability with the government. The government will send the tax payer the cheque in full or partial amount of refundable tax credit.   The buyers need to own the home a minimum period of 3 years to capitalize on this credit and they need to return the credit to the government if they sell the home before the 3 year window.
The response from the housing industry has been pleasing because the stimulus plan improved over the earlier low interest loan ( $7500) . This credit plan aims to bring in 3 lac new home buyers into the market. The major advantage seen in this act is that it has a ripple effect as each first time buyer sale will lead to two more trade-up transactions in the line.
Few of the real estate experts are of the opinion that the industry will not benefit since the first time buyers are already struggling to come up with down payment.
Finally, on the lighhter note , all this credit would help the buyer is to buy a new sofa, rug or lawn mover- thereby help stimulate the economy.