The Real Estate World AFTER the Tax Credit
I have heard from many within and outside of the real estate profession that the real estate market is going to die after the tax credit expires April 30th. They quote unemployment figures and talk about the US and world economy. They talk about declining prices and people being upside down on their homes. They feel the market was active until now only due to the tax credit. Those are opinions without merit. Let’s look at a few facts.
The people purchasing properties to recieve the tax credit are mostly people who would have purchased a home in the near future without the tax credit. The tax credit just gave them the incentive to do it now. This has given the housing market a temporary bump up.
True unemployment may be up around 15%. There are still 85% of the nation who are employed!!! Many have the capacity to purchase a home when they need to. They just do not need to, and many are just sitting back waiting for a bottom.
The US and world economy are in a mess. That is a fact. However, this will not deter the person who is in the market to purchase a home and does his or her research. They realize that much of the existing problems in the real estate market came about due to speculators, and if they purchase a home that is within their means and at a conservative price, they will have no problem.
Prices are declining. It is called supply and demand. We presently have a glut of homes on the market, and this is giving the small group of qualified buyers many homes to choose from. The smart seller will make sure his home is priced properly to attract these buyers.
When the supply decreases, the market will recover. Banks presently are holding large amounts of delinquent non-performing loans or foreclosed properties in their portfolio. Once they are forced by the regulators or stockholders to get them off their books and liquidate these properties, they will add substantially to the already glutted market. Prices will continue to decline, probably for the next year or more. At that point, we will hopefully see a bottom.
Finally, there will always be buyers and sellers in any market. This market is weak compared to the boom years of 2002-2006, but there is still activity. If you are a savvy purchaser, you now have the opportunity to hook up with a professional real estate agent, and have them help you find your dream property at a realistic price. Don’t give up! Keep looking.
To learn more about buying and selling real estate, please check out our blog at www.manausa.com.Jay Novak(850) 228-1568
Jay - Couldn't have said it better myself.... a number of my first time home buyers recently have been more concerned about getting the best home than the tax credit... ...
Great blog Jay!
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