I had previously answered this question, saying it wasn't likely that I would purchase a house because the prices weren't low enough. Well, I decided earlier this month that my lifestyle was more conducive to a condo (after looking at numerous homes with a Realtor). I found a nice, clean, kept-up condo that was listed at $7.1K under my maximum. We offered 18% less than asking price and got it. I'm paying cash and we close early next month.

Yes, they are motivated sellers. Even so, I'm paying 45% less than the owner purchased in 1992 (has been the only owner of the condo, it was built in 1990). Finally, something that works for me. And this is someone who never thought she would ever afford even a condo!

If you havent heard about this yet then you need to pay attention to the news! Everyone who is looking for homes has to be on another planet to have not heard about it...I want to take advantage of it but I am waiting to hear back on a shortsale I made an offer on!! Till then i am actively looking however few homes trickle onto the market in the 0-200,000 range its depressing. I would not choose from theses homes currently on the market no matter how much the government offers.The few that seem nice in pictures look horrible in person they all need serious rehabs starting anywhere from 15,000-50,000 to make them normal.I have no debt, 20% down and Ive been approved for FHA loan at 4.5 % Which is a preety good situation when buying a home,and still it would be hard to afford a mortagage with all of those rehab costs. That 8,000 dollar incentive is free but its really a drop in the bucket it would barely scratch the surface when making these homes decent. So if they extend this program till the end of 2010 and double it that would make it worth it and doable in theses run down areas. Plus I need more time to save so I will have more money to take on this huge rehab issue warwick homes seem to have. So Im going to wait it out till next May to buy a home if this shortsale doesnt become mine.

My husband and I were thinking of buying our first home to take advantage of the credit. We were pre-approved for $500K, and so we started looking. However, in the parts of Los Angeles we were looking at, there just didn't seem to be that many homes for sale. Everything decent was getting multiple offers, often fifteen or more, and selling within days. For every five listings we asked our agent about, two or three were already under contract. As much as we want to buy a house, we just couldn't make ourselves participate in a bidding war, especially when there so many houses in foreclosure. And I know several other people who also tried to buy in Los Angeles this summer, and none of them found anything worth buying. So we're waiting. Sure, we may lose the $8000 tax credit. But we're not going to buy just to buy.

OMG, we need to stop it with the bailouts to prop up inflated assets. Like national debt isn't high enough, we need to give away $15k to incentivize people to purchase homes. This is getting re-god-damn-diculous.

Hope all will support the Johnny Isakson bil to give us a $15,000 tax credit for all owner occupied buyers in all income groups and not only for first time homebuyers. If he gets it past, the homes will have to close by June 2010. He had it attached to the clunker bill and only missed by three votes.

Write your Senators and Congressmen. We need this.

Sally W. Hamby
The Sally Team
Georgia-Atlanta
Mortgages

May be they are not going to lenders and checking out their options. Work with a lender or mortgage broker that has expertise in credit counseling. One who will give you guidance on how to get your credit scores at an acceptable level to buy? Second thought; First Time Home buyers are scared. It is a big responsibility to purchase a home. They need more guidance from REALTORS®. FYI: anytime you see the trade mark REALTORS® behind an agent’s name you know they are bound to an ethical oath and a member of an association.

This question is quite elementary. Who hasn't seen the job loss rates country wide. How would anyone expect a jobless first time home buyer to qualify for a loan? This tax credit has worked well in areas like mine that have not seen a huge economic down turn, but most of the country has. I do however see light at the end of the tunnel....or is that an on coming train?

Davids character/honesty and desire to assist people is supported by his comments. He has always tried to be fair and deserves some respect IMHO. If I wanted an Honest opinion David is a member I would seek out never doubting that Honesty is what I would get.

A differing opinion does not equal Anti-Anything nor does tossing unsupported insinuations into a discussion accomplish anything more than creating the appearance that you really have nothing to say.

Puzzling. Dave came back and deleted his prior postings. Go figure.

WOW; the fast answer is confusion, there is way too much of it. The Tax credit is a complicated benefit for first time home buyers, it requires a little effort by asking their Tax advisor of how to best use it. Then it requires the knowledge of the Mortgage professional to properly implement it. Aside from the fear of uncertainty, including but not limited to ones job, property values, and economy. It is a darn good time to buy a home. There is also the added program of “HELP” Homeowner Education and Loan Program. http://www.myhelp-connection.com For more information contact me http://www.trulia.com/profile/id/277626

David? Different opinion = anti-Realtor bias?

It seems to be the popular slur to use. It has become an answer for some that is much easier to use than a well thought out reply..

I don’t know how you arrived at that take away, Dave; that I “don’t like Realtors®.” I can assure you that it’s not true. Predicting a continued fall in the value of real estate does not make me someone who dislikes Realtors®. There is plenty of blame to go around in regards to this mess, and the sandwich is big enough for everyone to take a bite.

I’m not sure what you mean by your train analogy, but to blame some mythical train for the disaster in real estate doesn’t really explain how we got here. I wasn’t on the train. I’ve been as short of real estate as one could be.

Group-think, greed and irrational exuberance drove the run-up. Denial, fear and panic will continue to drive the downturn. The negative sentiment of the average consumer, in regards to real estate, is no more to blame for the downturn than Time magazine is to blame for the run-up.

Enjoy the show.

If you want to blame Steve’s well founded, commonly held negative outlook on housing for “helping push us deeper into a depression” then the Realtors® must take a bite of the blame sandwich and take responsibility for the rampant cheerleader, blinders-on boosterism that got us here in the first place.

David - as you discovered, Steve isn't , as he put it, a "lone poster"........he is an "imposter".....posing as a broker........which he clearly isn't - therefore, nothing he has to say has any relevance in my opinion

What is clear is how totally threatened several realtors are by a lone poster who defies and laughs at their silly real estatecircus. If all is so wonderful in your industry then why the incredible interest in silencing detractors? The illusion is over so why invest any effort into NAR lies?

Is your response, "Steve is so negative!' the best response you can come up with to the facts I provide?

We can all see how the shattered real estate industry are pushing you to desperation. There are other lines of work.

Victor - it's clear "Steve" is a phantom persona not worthy of a response......he is neither a broker (that's a laugh) nor a legitmate buyer or seller.....he just likes to spout his negativity....I report him when possible, and ignore him at all other times..much like one would ignore an annoying little gnat that's buzzing around you!

Some how I don't think steve is really a real estate broker? As I said in another thread, I'm startin' to believe it, could steve be the goat profile reincarnated?

50% off 2009 Prices? You can't be serious, what data do you have that could support that GUESS, it is just a guess after all unless you are a fortune teller. Even the feds and case shiller index are showing an uptick in real estate sales saying its showing signs of stabilization.

Steve a real estate broker???? I highly doubt it, most real brokers will create a profile and show their contact info and as required by law name the brokerage they are affiliated with.

Steve is obviously a fake profile of someone just trying to dissuade buyers from doing just that. Just another character which is part of a new slacker movement on trulia to promote avoiding home ownership at all costs, probably a stock or gold broker. ;-D

Get a life, get a job, get a clue....

"Time is getting very short home buyer!"

Paleeeese! 2010 will see so many homes begging for buyers at 50% off sales that few will be bought because all the naive buyers will have already bought much too high in 2009.

You have been working very hard to pay off all of your past due debts. You have not charged any new purchases on your credit cards. You have been saving every free penny into your bank account. You feel confident that you are ready to buy your dream home. You contact a real estate agent and that agent puts you in contact with a mortgage specialist right away, and when the credit report comes in; you are shocked to find that all those debts that you had worked so hard to pay off - show up as not paid! How can that be!?

Well as diligent as businesses are in contacting you to pay off your debts, the businesses are not as diligent when it comes to reporting to the three major credit reporting agencies that the debt is being paid as agreed ; or has been paid in full and sending you a "Letter of Satisfaction".

Mortgage companies are keeping to a much stricter rule of your credit rating before permitting you to obtain a mortgage for that new home! And for the first-time buyer, or the person who has not owned a home as their primary residence for three years who have worked so hard to reach that dream of home ownership, who want to take advantage of the tax credit before November 30th are now finding themselves upset and disheartened because they must now dig out all of their paperwork (hoping that they kept all of it), contact those companies and request that "Letter of Satisfaction" and hope that they can get all of those "Letters" in time to meet that November 30th deadline!

Do understand this; these companies are not motivated to send out those letters! You must contact them again, and again, and again - I suggest every ten days! I have a client who has been waiting 3 MONTHS for their "Letter" from a paid-off debt! I am not saying all companies are this uncaring for your situation home-buyer; but you must be AS consistent following up in order to raise your credit score!

Time is getting very short home buyer! Contact me so that I can put you in touch with mortgage specialists who can run that credit report and make sure that everything you have worked so hard for - becomes a reality!

I also think that many first time homebuyers don't understand what a Tax Credit is. Many think it is just a deduction. Education is important in getting these buyers to come out of the bushes and start taking advantage of it. It's a great incentive.

One point is the tax credit will end Nov. 30, 2009 if your purchase does not close by that time you are out of luck. The income limit fazes out for a couple I believe above $150,000. Interest rates are get now about 5.25% with good credit. Lenders will not even quote rates until they know your credit score and then you could see as much as a 1/2 rise in rates. If rates go up and they will to off set the bond market will we see rates close to 6 % this fall. That will really hurt the purchasers of homes. You need to get out there and buy a home and get it closed before the rush starts mid September because it is taking 40-45 days to close on a house and it is going to get longer as the program ends. Good luck to you.

Tom Inglesby, Broker
RE/MAX Equity Group inc
ABR,CRS, EA S.T.A.R. eco-broker
503-319-9035

Great write-up on the First time Buyer stimulus and the USDA 100 % loan program. TO ALL THE BUYERS reading this blog - One thing I like about real estate is "negotiation" and in this market Serious Sellers are willing to do this if they want to sale. I have been solving the closing cost crisis with Seller assistance, this is where the Seller will pay for your closing costs.

The tax credit is an awesome incentive for buyers. It only applies to first time home buyers which is defined by not owning a home in the last three years. I think some of the problems have been that last year it was different and had to be paid back. Many people did not understand how it worked. This year they changed it where buyers did not have to pay it back. However, one of the main reasons for this program initially, was the FHA did away with all down payments assistance programs meaning first time home buyers can no longer obtain 100% financing through FHA. The tax credit does not solve that problem. In my market it has really affected my first time home buyers. There are still 100% loan programs through USDA or many cities have grant programs available. The problem is most of them are income based and can only be used in certain areas. Many are saying that the tax credit limit will be increased and extended and even my state has passed its own credit. Many of my clients were able to go back and amend their 2008 tax returns after they closed. As a real estate community we need to really promote the tax credit and hope that the media will start being positive and encourage home ownership.

There are too few locations to get information or experts on the topic. Most that have heard of the program have heard conflicting information.

Inform your clients and make sure they understand where to get information.

Maybe they are and you do not know it. Question to ask who are your contacts in the real estate world and how are you contacting the current buyers? What WOW's Buyers? The basics that was just told to me :"ive Free Ways to Woo and Wow Your Clients" words to live by:
http://realestateisreallycrazy.blogspot.com/2009/05/five-fre…

I am a real estate agent working in the South Central part of Wisconsin, Juneau, Adams, Monroe, Vernon, Sauk Counties, There are still 100 % financing if you as a Buyer qualifie. This is a great time to Buy especially for a "first time home Buyer” (1) A great stimulus package that is not required to be paid back (never happen before in home buying) (2) It is currently what they call a "Buyer's Market" (many homes on the market with competitive pricing) (3) Interest rates are holding and are still considered low. ........This question to ask is “Why wouldn’t you buy at this time?

I think there are alot of first-time home buyers out there that WANT to buy, but can't because they can't put enough money down (most bank are asing for 20% down) or may not have good enough credit to get bank pre-approval. Some 1st-time buyers also are not educated enough to know that they may qualify for a FNMA (or VA loan) which have signifcantly reduced downpayment requirements (3-4 % down for FNMA ?). Also, some 1st-time home buyers may not qualify for the $8K tax credit if their income is to high. The government and NAR (National Assoc. of Realtors) are also lobbying to increase the tax credit to possibly $15K which also may cause some 1st-time buyers to delay.

The biggest factor I believe is the "fear of unemployment", coupled with the fact that homes prices are still falling (1% per month ?) in most areas (like Hunterdon county, NJ). Just like the stock market, people who choose to wait and try to time (buy at) the bottom, often lose out on a great opportunity to buy.

I agreeto some extent with Tom in,

"We ARE seeing a big pickup in activity in the first time buyer market. People are still nervous about the economy (if you are afraid that you may lose your job, you are probably going to sign another Lease!) but many people see the benefits of purchasing in this market. Remember too that the lenders are more restrictive than they use to be. So the 'pool' of potential buyers has shrunk"

Do YOU and your Buyers know about JOB LOSS PROTECTION? "HELP" This program provides coverage for 24 months- payments of up to $1,800/mo for 6 months. 24 months of Home buyer eduction with the first 6 months inbound to the buyer. An emergency fund in case of dyer circumstances.
It has and will continue to HELP many in months to come.

That is not true. About 85% of the prospects are First Time buyers. After first consultation with so-so credit score and 3.5% down prospects realize they can not low ball a foreclosed homes. Most do not have enough savings to compete with investors who pay in cash for low priced homes.

So you have 20K savings and would like to buy a single family home in Silicon Valley? There are 56 offers on it already.... Only the fittest get it.

We ARE seeing a big pickup in activity in the first time buyer market. People are still nervous about the economy (if you are afraid that you may lose your job, you are probably going to sign another Lease!) but many people see the benefits of purchasing in this market. Remember too that the lenders are more restrictive than they use to be. So the 'pool' of potential buyers has shrunk. But the smart money is buying right now. If you don't have a home to sell, are pre-approved for financing, and can be flexible on possession (opening you up to distressed sales) then there has never been a better time. Especially if you are a first time buyer ($8,000 tax credit!).

Tom Carris
RE/MAX Showcase

Christine,the reason is that they put this out there for buyers to use,but it may change over night and no one will take the chance.they don't really know that it works well.and maybe somewhere someone is turing this around and its not here yet...as a buyer you don't do anything in less you have the green in your hand.maybe this tax credit has everyone at a risk becuase its so new.Christine i think we are running out of buyers and everyone is running on empty,its a big chance but just to slow from top gov.some places are making really great money and look at other's thats not,WHY? and it will run out for them it will take some time.most of them build supply for war but when they pull them out from having to fight a war everything will stop.there want be a need for building tanks,thats when these towns will take it hard.sorry i had to go there.

The way I see it is that most of your first time homebuyers are having a difficult time getting financed. This is what I have been seeing. If you can get financing and have the patience for a short sale or foreclosure, there are fabulous deals to be had. It just takes patience and a persistant agent who knows how to handle short sales. I you can get financing, it's a great time to buy.

I work with a lot of young buyers, and what I have found is that they just don't understand how the credit works. Most of my clients didn't know it could be converted to a down payment. I also know a few people who thought they would wait till next year to use it, but after I informed them of the time limit to use the credit they started to look now. I think if more real estate professionals got the correct information out there, that more people would use it. I have been posting blogs and links to information about the tax credit on all of my soical networking sites. Also, realtor.org has a great page that explains the credit in terms people can understand.

What's the point of a $8,000 tax credit if the value of the home plummets $8,000 in a month? This deal is definitely great for some people... But in some states in certain areas, the values of mid to high end houses have barely budged. With the upcoming next wave of foreclosures, it prices are going to be plummeting fast and the $8,000 will not offset those drops.

As many of you say Buyers are not fully educated on the Tax advantage and how it applies to the purchase of their first home. It is very confusing to everyone how to use this credit. Most Lenders (unless it has changed in the last couple of weeks) will not allow you to use it for any part of your closing cost- even though it is approved in some fashion to do so. All the wheels on the cog just don’t know how to accept the credit as such.
Another Program that is helping buyers is Job loss protection, offered by the seller to attract homebuyers and give them a real comfort to know that they can purchase and have 2 years coverage in the program. Many educational amenities come with this program for the buyers benefit. To learn more go to my Trulia link. I am happy to educate on this program

What good is an $8000 tax credit when one can wait till 2010 and get tens of thousands of dollars off the asking price as sellers become more desperate?

Shadow inventory of foreclosed homes is truly massive and growing.

A lot of first time buyers I've spoken to were not informed about the $8,000 tax credit. For those buyers who are financially stable this tax credit makes a lot of sense. For buyers who aren't financially stable, a $8,000 tax credit won't make the unready ready.

Rhondda wrote, "Many people have lost their jobs, and not able to buy or move at this time. If you can afford to buy, now is the time!"

Such statements make me cringe. Now is the time to rent for the vast majority of people who are not able to secure deeply discounted homes say 1980's prices or better. Buying now as unemployment rises and with interest rates at record lows guarantees economic devastation for most buyers.

Higher interest rates, unemployment will result in dramatic real estate price drops to the great benefit of patient homebuyers.

Mjb..hello

If your income will be less this year in order to fall within the income limits, and you purchase in 2009, then you should be ok. It is this year's tax return - 2009 - that will also determine your eligibility for the tax credit. People could have used 2008 incomes, or filed amended returns to get the mooney sooner, but you can also use your 2009 income and request the credit when filing in April. Please check with a tax preparer, but that is my understanding.You must close on or before Nov 30, 2009, or anytime since Jan 1, 2009.

Certainly interest rates on mortgages are still comfortably under 6% - they have fluxuated somewhat, but not enough, in my opinion, to make you "wait" till the credit option has expired in the hope that rates will then come down. That truthfully doesn't make sense to me. My crystal ball won't tell me what mortgage rates will be doing in the future. I prefer to deal with what is currentl, and currently, they are very attratctive , and still at historical lows.

And, for the record, there is a bill in the Senate that proposes extending the credit, increasing it to $15,000, expanding who will qualify to all buyers, and eliminating income limits.. Who knows what will happen with that. So..... if you're waiting for the credit to expire, it might not be happeneing as soon as you think.

I am not saying you should run out and buy a house just because of the credit - just wanted to clarify that you might be eligible to make use of it if you so choose.

Best wishes.....
Debbie Rose.

This credit is for first time home buyers. They must qualify with stricter qualifications from loan companies. FHA and VA are still working for people with good credit, and a great way to buy in this market, with little to nothing down. Good credit and a substaintial downpayment is what is needed to buy if not using VA or FHA. Many people have lost their jobs, and not able to buy or move at this time. If you can afford to buy, now is the time!

Answer: Because people don't want to steal from their children and grandchildren to subsidize the purchase of a home. Also, they are beginning to realize real estate was and still is overpriced, hence the need for a subsidy in the first place.

I think that the people who would be most apt to use it don't actually qualify for it. My husband and I fall into this category. In 2008, we earned significantly more than we will this year due to bonuses, etc. We earned more than the cap. We would love to use it, but last year's tax return is preventing us from doing so. We are excellent candidates to purchase a house - $ to put down, no house to sell, excellent credit, etc. We're just not in a hurry because we know that we don't qualify for the credit. The other issue is that the tax credit is causing a demand for mortgages and driving up mortgage interest rates. It may be in our best interest to wait to buy until the tax credit expires? (Not something we made up - have been told this by many pros) So, this credit means nothing to us?

Because spending 200k to get back 8k from the government dosent make a hell of alot of sense to people that dont already own homes. Most people that rent dont have enough for a house payment secondly we are in the middle of a recession and most people's jobs are not secure. I think as Realtors we forget how unstable the typical US job is currently. I also think alot of people are anticipating the US government will extend the rebate for another year.

I agree with you that more buyers need to take advantage of the tax credit - And it is our Job to educate them on it. Lets get out there and put together Tax Credit Seminars. It will benefit the whole market - the more we educate everyone on this!

Unfortunately I think that there is a lot of mis-information out there that they homebuyers don't know or understand. First of all, you don't have to be a first time homebuyer - if you haven't owned a home in the last 3 years, you may qualify for the tax credit.

There is a website to go to that will answer a lot of the questions that folks seem to have regarding the Tax Credit - I will be happy to share that with you:

http://www.federalhousingtaxcredit.com/2009/index.html

Hopefully this link will be of help to you.

Actually there are some very stringent guidelines to qualify for the Tax Credit. I do not know the numbers, but I am sure that the credit would have been more successful if it had been less difficult to qualify. It only makes sense that if more buyers could have taken advantage of it, they would have.

EJ... Yes I do believe it, as a matter of fact I have first hand experience with this exact scenario. I expect to see more of this as time goes on, provided there is not some other event to shake things up again. As I said my crystal ball is broken and it is one mans guess against another. We only know what we know as fact today.

SV:

"prices could begin to climb as banks become more stable and less willing to take a loss on foreclosed properties"

ROTFL. LMAO. Sellers have ZERO pricing power in this environment, let alone banks saddled with foreclosed properties. Do you honestly think a banks will sit on properties given the carrying costs (taxes, insurance, upkeep, etc.) and other risks (squatters, vandals, further price deterioration, etc.)? I think not.

a recent study showed that more than 40% of first time home buyers don't even know it exists. On my daily prequalification/preapproval calls I'd say that 50% of my first time buyers had not heard about before I mentioned it or they'd heard a little about it but weren't clear about it's structure.

EJ is obviously jaded regarding real estate agents! Too bad because in general Realtors are educated and dedicated and great resources for all sorts of information. True, business is not as brisk as it once was and many agents will be reaching out for new business but this is good business practice and anyone who has the gumption to go out, knock on doors and try to drum up new business should be viewed as the kind of person you want to do business with! After all, we are in the business of sales and we must search for clients in order to succeed. Those gutsy agents are ambitious and dedicated and it is no fun having people slam doors and phones and generally abuse you for trying to make a living. The flip side is that when we eventually connect with someone in need of the services we provide it is a win/win situation. As far as having the time to answer questions on Trulia, it is a service.

As for the Tax Credit issue, many people do not understand it or know about it and it is a Realtor or lender that brings the information to the client. Each person's situation is unique and if you are ready to purchase a home you have choices to make. If you qualify you can take advantage of the tax credit as well as some very attractive interest rates. You can also make a much better deal on the home of your dreams today than you could last year or two years ago, etc. If you choose to "wait and see" then you join the ranks of risk takers who are banking on rates staying low, prices dropping further and tax credits being increased. I don't know if any of these events will take place, my crystal ball has been out of commission for a long time! Interest rates could go up, prices could begin to climb as banks become more stable and less willing to take a loss on foreclosed properties and the tax credit could expire or stay the same. What I do know for sure is that now is a better time than it was in 2005, 2006, 2007 or 2008! Will 2009 join the ranks, guess we need to "wait and see".

Buyers need to evaluate their personal needs and desires and weigh them against the economics of today.
If you are buying a home you will look at the purchase much differently than if you are buying for investment only. In the past buyers were just happy to buy so that your "rent" payment was going to toward something tangible and maybe you would see a little return on investment in 10 or 20 years not in 6 to 12 months! I purchased a home in 1978 for $62,500. 21 years later it sold for $156,000. Gee if I had waited another year I could have sold it for $250,000 but then I would have had to pay $100,000 more for the home I moved to.

Bottom line, find a Realtor and a lender who will give you the advise you need. Ask your friends, co-workers and neighbors for referrals. Look for agents who offer credentials that indicate advance practice studies such as CRS.. Certified Residential Specialist. These designations come only with a significant investment of time and money to obtain additional education and is not a requirement to hold a license to sell real estate!

EJ, Realtors provide a service for a fee. If you feel qualified to make is often the largest investment of your life on your own, Bravo! But don't deride the roll Realtors play in providing valuable services to those who may not feel so qualified or who have relied on the advise of trusted real estate professionals over and over again. If broken down to an hourly wage most real estate agents would fall well below the average minimum wage law! In other words "we work hard for our money". Remember, most people are qualified to dig their own hole, but they still need an undertaker to finish the job properly!