Thursday, March 18, 2010
As the deadline for 1st time and repeat buyer tax credit approaches,housing prices are going up. Make sure you have an agent who knows the market
Interesting real estate article in Washington Examiner.
Sellers are perceiving that buyers will pay more for a house than the otherwise would because they want to take advantage of the first time or repeat buyer tax credit,where a buyer must get a home under contract by April 30,2010 and settle by June 30,2010.
The sellers see the tax credit as a product in heavy demand that buyers are getting in line for in the next 6 weeks or so. They are probably right. But,buyers more than ever,especially those with buyer agents who know the market and have access to the sales comparables,can tell when a house is priced outside the market.
Why would a buyers put an offer on a home for tens of thousands of dollars over asking price,when the tax credit limit for first time home buyers is $8000 and for repeat buyers it is $6500? The tax credit is more than offset,for lack of better words,by this pricing strategy.
There is also a lot of housing inventory out there,so the only way this strategy only works,I think, if a buyer needs a specific model home,in a specific subdivision and this model in this specific subdivision rarely comes up...and it is a highly sought after model that may bring multiple offers.
To me,sellers should be listing their homes for sale based on the market and the property condition of their homes. Many buyers want homes that are updated and show well. Otherwise their homes will sit on the market for a while,beyond April 30, 2010 and risk buyers who didn't find a home stepping back onto the fence unless their is another first time/repeat buyer program created. Again,sellers
If you want to talk about the market,let me know. I am here to help.
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Licensed in MD & DC
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301-718-4100 ext. 132
Oh,by the way,I am never too busy for your referrals.