The Effect of the $8,000 First Time Homebuyer Tax Credit - Past, Present, and Future

• Press Release
• Source: StartingPoint Realty
• On 3:27 pm EST, Tuesday November 10, 2009

CHICAGO, Nov. 10 /PRNewswire/ -- With the $8,000 tax credit being extended into 2010, what are the true effects of the tax credit? "Many homebuyers purchased in 2009 that otherwise would have not have bought a home," states Ryan Gable, owner of StartingPoint Realty, Inc. "There were a lot of people that qualified for financing, but were afraid of the whole process. $8,000 gave them a reason to at least investigate the experience of buying a home, and most took the leap."

StartingPoint Realty, Inc works solely with first time home buyers in the Chicagoland area. Gable recently looked at all their client's purchases in 2009 and found something interesting. "Half of our clients bought bank owned or short sale homes and the other half bought homes from sellers that were moving up. These buyers are not only clearing homes off the market that were causing values to drop, but they're also spurring at least one other transaction in the marketplace." How much has the tax credit spurred demand? "We'll never really know the answer to that question, but I would say over 50% of our clients stated it was a big reason for them to get off the fence. It made a bigger impact on people buying the bank owned homes, because they knew they would be getting that money and they could then fix it up."

With the extension of the credit through June, 2010 (contracts must be signed by April, 30), Gable is positive this momentum will continue. "There is still so much bank owned inventory out there right now, but as the economy begins to improve, the addition of these homes to the aggregate supply will begin to slow down. With this credit, buyers will continue receiving an incentive to both buy homes in need of repairs or buy homes from sellers looking to move up. Either way, its a win-win for everyone. It stimulates the housing market and essentially the entire economy - all because of the first time homebuyer armed with their $8,000," said Gable.

StartingPoint Realty focuses solely on the first time home buyer market and was founded in 2004. Weekly first time buyers seminars are held throughout the Chicagoland area and a monthly newsletter, titled The Elbowroom, is also distributed on a monthly basis. For more information and resources visit www.startingpointrealty.com.

Buzz up!