Calculated Risk has a good rundown of what’s happening with the First-Time Homebuyer Tax Credit — the $8,000 sweetener to buy a new house that’s been helping to goose home sales. CR predicts the law will be extended past this year, given its popularity and the desire among politicians to keep the housing market afloat.
The post ends with:
Anecdote: I’ve spoken with two younger guys (30 ish) who told me they had no down payment, but their wives are pushing them to buy a house NOW. They are using the tax credit and FHA to buy. I think that conversation is happening in many places.
This suggests existing home sales will decline – perhaps significantly – after the frenzy subsides.
Of course, this dynamic was popular during the bubble, and was on display in the famous “Suzanne Researched This” ad for Century 21.
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