What happens when the tax credit expires?

For the last couple of months, we’ve been turning a corner of sorts in real estate. The number of sales has increased, inventory is slowly decreasing (still high though) and foreclosures have stabilized. As the opportunity for the tax credit comes to a close on April 30th, many sellers, buyers and Realtors are wondering what would happen to the market thereafter.

Although no one has a crystal ball, one can make an educated guess as to what to expect. Below are some of the reasons I believe the market after a dip in May will continue to march ahead of 2009 in the number of sales.

1. We know that even with the tax credit in place only about 1/4 of the buyers were enticed to buy to secure the credit (study was done by NAR in late 2009). That leaves at least 3/4 of the current buyers in a state to continue shopping for a property.

2. Many of the buyers that are in the market to get the credit have waited till the last few days to write offers. Some of these buyers will not find a home by the deadline and may continue to look after the deadline. Of the offers written in next few days some will fall apart, as many are written by mediocre agents (see other posts about this very subject). Those buyers I am sure will go forward to secure another home.

3. The economy appears to be improving and more unemployed should be heading back to work. As consumer confidence goes up we would expect additional buyers to enter the market replenishing the buyers lost due to the lack of the tax credit.

4. Interest rates are at historic lows and should continue low unless the overall economy heated up considerably.

5. Down payment assistance programs and grants continue to exist. Should the market not recover sufficiently, expanding programs for the first time homebuyer could become reality.

Even though we expect sales to stay ahead of 2009, prices will still be under pressure due to the high inventory of homes for sale and appraisal issues which are a result of new rules.

Another American Idol connection!

For 25 years now we have sold plenty of local celebrities' homes (many celebrities are smart people and choosing Homeowners Concept is the most intelligent way to sell). Recently, we seem to have connected with American Idol celebrities. A couple of years ago our company sold Caroline Leiter's (of Channel 12) home in Glendale who was seriously involved with Taylor Hicks. In fact he showed up in one of the interior photos.

One of our most recent listings involves Danny Gokey's house. This 2006 split ranch at 11212 Sanctuary Drive, Milwaukee is an absolutely fabulous home boasting quality, grace and perfection. 2,172 sq. ft. 3BR/3BA, 3.5 car Garage , Gourmet KIT, soaring ceilings, professionally decorated. For all the other amenities and interior photos you go to Http://HomeownersMKE.com, just enter "sanctuary" in the street name.

Seller gets $26k more than originally offered.

The seller of this property at 4344 S. 51st in Greenfield was contemplating of selling it to Homevestors for $125,000, when on a lark he decided to call us. For those of you who are not familiar with Homevestors, it is a franchise that typically buys properties in need of work and for a price below market value in order to remodel and resell for a profit.

One of our agents Julane Myers went to the property and upon further review she suggested that seller could get as much as $160k for it. Seller was reluctant and afraid he might not get much more than the $125k he had already been offered. At the end, he did agree to market the property at $149,900 since he was in a hurry to sell. Within a week 3 offers were on the table with the winning offer at $151K. Seller was ecstatic to say the least and very appreciative at Julane for insisting at the higher price.

The seller was wise to take the advice of an extremely experienced agent (as ALL of Homeowners Concept's agents are). We hire only competent, honest agents that abide by the Realtor Code of Ethics.

April Special-No lender closing costs!

Our affiliate lender NetCentral Mortgage (414-258-7833 - netcentralmortgage.com) has a special for first time homebuyers that are looking at doing an FHA loan and closing in April, NO CLOSING COSTS! This is for purchase only. The only money the buyer will need is downpayment and prepaids (taxes and insurance). The rate on this program is also very good, 30yr fixed at 5.375% with APR of 5.743% (as of 4/1/10)!