Monday, September 21, 2009

St George Real Estate Update - Clock Ticking on First-Time Home Buyer Tax Credit

St George Real Estate Update
St George real estate has perked up since March or April 2008, yet the pipeline seem to be so full of Short Sales and REO bank homes, that one wonders if house prices are dictating the "real" market as having really been curbed from falling. I think they have. From a realtor perspective I have seen less and less product on the market and little signs that buyers are going away. Nationally home prices have been slightly increasing since May with the glut of inventory on the market being scaled down. This really is the long of the short of it and uncertainty is on the horizon as to being watchful about inflation which would cause interest rates to rise.

Clock Ticking on First-Time Home Buyer Tax Credit
The clock is ticking on the first-time home buyer tax credit of $8,000. However, the odds that Congress will approve an extension are about 60 percent, estimates Jaret Seiberg, an analyst for the Washington Research Group.

The concern on Capital Hill is that the recession along with unemployment, and more stringent lending requirements lead the first time home buyer to have diminished interest and capacity. So, the widespread concern is that without the tax credit, home prices will begin falling again and reverse this year's gains in the housing market.

Indeed, coming up with that down payment or being able to pay their bill on time is what many a first time home buyer is worried about. The National Association of Realtors reports in July that about 3 out of 10 homes were snatched up by the first time home buyer, but that is down about 10% of what the previous 6 years reports for July.

Of course there are many critics of the first-time home buyer incentive that see it as a subsidy for people who don't need one. I've seen some of that... where a buyer is surprised or impressed after the fact of already wanting to purchase. However, others estimate that... the tax credit will draw about 400,000 buyers into the market this year, said Mark Zandi, chief economist for Moody's, who supports extending the tax credit into at least the middle of next year.

The source for some of the above information came from mywire or the associated press here.

New Home Starts are Up
New home starts have had their first little pick up since June of 2008 after a long descent. Interest rates are holding down at 5 to 6% and with suspicions of inflation still looming large. Inflation is the archenemy of Bonds and home loan rates, so now, is as good a time as ever to invest into the market for the future. Most people do not know how easy it is to find out if they can pre-qualify for a St George mortgage.

Remember, if you can sustain home ownership investment, it is the best indicator, even through difficult markets, of wealth building. The commodoties market, with the materials valued in the home sustaining themselves, also tends to confirm this.

Remember there is a new Home Run 2 grant that also gives $4,000 on a new home or build job.

As always, I am here to aid and serve your bottom line when it comes time to buy or sell- please call me, Brian, your St George realtor, as I am every ready to help aid and secure your interests when it comes to your St George real estate needs for the area.