FIRST TIME HOMEBUYER TAX CREDIT
Once again, the tax credit is coming to an end.
It’s set to expire on April 30, 2010. We’ll see if we have the rush to write contracts in the coming weeks. If you’ve been pre-approved and are just waiting for the right house, you’ll be fine for the next few weeks. However, I wouldn’t be looking a short sales. These transactions take a bit longer. Stick with the “regular” sales or lender owned.
I took a couple out to look at homes last weekend. They have put offers in on several homes over the last few months and each and every time there is a multiple offer situation. It can be very disappointing. When you find a home you like, make sure your agent calls the listing agent (if possible) to ascertain whether or not there are any offers on the property. Offer what you would be willing to pay. For example, if the house (lender owned) is $80,000. Are you willing to pay that? What about if you end up in a multiple offer situation? You’ll be asked to come back with highest and best. You could be bidding against cash offers. If you’re an FHA buyer, the seller will most likely take a conventional loan over yours. If you’re asking for seller contribution for closing costs, that may make your offer less attractive if there are others that don’t ask for contributions. Be prepared to know how you will proceed. Once you’ve made an offer on a home, you’ve got an emotional stake in it, and it’s disappointing when it falls through.
I put an offer in on a home and there were multiple offers, so we moved on. I got a call from the listing agent 2 weeks later that all the other offers had fallen through and was my buyer still interested. That was a good outcome as my buyers will close in about a week.
It will be interesting to see if when the tax credit expires the number of offers presented on a property decreases and if the market slows down substantially. I’ve talked to people who don’t care about the tax credit and then some who are counting on it. Should be an interesting summer in the RE business.
