The $8,000 homebuyer tax credit was a saving grace for many Realtors during this economic slump, and has helped to drive thousands of buyers towards purchasing homes during the real estate crisis. Not surprising, though, is that since its deadline on April 30th home sales have dropped. Ironically, even without receiving a tax credit, buyers may save even more money now that the reward is gone.
Sellers Driving Prices Down
Since the tax credit has expired, sellers and mortgage companies are forced to find ways to draw in buyers on their own, and have begun offering promotions and dropping home prices drastically (as much as 30% in some places) in order to attract potential consumers.
The largest market is for first time buyers, homes in the $200,000 or less range. Currently, sellers and lenders alike are offering deals that experts feel exceed the financial reward formerly provided by the stimulus.
What Buyers Can Expect
Incentives such as free appliance upgrades, basements renovations, rebates, trade-in programs, even sweat equity discounts can be expected from sellers. Some even are offering financial rewards comparable to the stimulus, such as Coldwell Banker’s “Buyer Bonus Program”, which offers consumers up to $8,000 in returns.
Record Low Interest Rates
Lenders are dropping interest rates and rates are sitting at historical lows. With rates this low, a home buyer will experience lower monthly payments and quickly building equity in a their home.
Incentives vs. Stimulus
The cumulative value of these incentives is much more valuable to the consumer than the homebuyer stimulus, which has cost taxpayers an estimated $18.7 billion. Lowered interest rates can save homeowners thousands of dollars in interest, and promotional offers can save time and money homeowners would have spent on home improvements. Though the rewards in this post-stimulus era of home buying may not equal cash in hand, this is definitely still a buyer’s market.
When considering all the incentives available to today’s home buyer …anyone who has been sitting on the fence and waiting for the right time to buy should seriously consider acting now since opportunities this good will not last forever.
Wes McFarland covers the Houston real estate market. He follows the economy and its impact on Houston homes for sale. Local trends are followed from information gathered from the Greater Houston Metropolitan Area, local MLS, and Houston Realtors working in the local markets.
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