Regardless of what governments are or aren't going to do with the checks I send them each & every year,  this 3% thing is driving me crazy (admittedly a very short trip).  People who buy houses, also buy pots & pans & furniture & books & everything else that goes into making a home.  Paint, wallpaper, garden tools.  All these purchases, whether made online, brick & mortar, full price or thrift store, means dollars moving through the system which is a good thing.  As Kurt pointed out the title business will pick up, which is also always a good thing.  Home ownership stabilizes neighborhoods (until the foreclosures start & then it doesn't anymore).  Even the professional home flippers, not my personal favorite human beings, have a role to play here, in the sense that they do some rehabbing. 

My problem is more along the lines of a road to hell being paved with good intentions.  If the plant buyers, & pots & pans people are loading their purchases on credit cards & really, truly can't afford the first gallon of paint then this is a reload of what we just went through & is really not good.   Hubby & I bought our extremely small house in 93 when a fortuitous combo of depressed prices & falling interest rates meant that we could, after 12 years of marriage, a small child & some savings, finally afford to buy a house.  I think we put 10% down; we jumped through the usual hoops &  as a self-employed person I believe that the bank ordered a character analysis on me by a professional FBI profiler to guarantee my general worthiness as a human being.   Ten years later, when we re-fi'd just to get a better rate & a smaller term, I practically did the whole closing over the phone. 

Today we couldn't afford to put down 10% of what our house is *worth* according to what the City assesses us at; so I get it when people want 3%- it's possibly the only way they can get a toehold in the market.    But what is that toehold actually costing homeowners .  The bank is the real homeowner- we're all just renters, who build equity a speck at a time, so maybe renting is more viable right now than buying.