For a two month period California home buyers had the opportunity to double dip into tax credits.
The federal tax credits of $8,000 for First Time Homebuyers, and $6,500 for long-time owners of existing homes must have had a written, binding contract by April 30, 2010 and close escrow by June 30, 2010.
The second-part of the two-month opportunity was a new California homebuyers $10,000 tax credit program beginning May 1, 2010 and continuing on to July 31, 2011, with an enforceable contract signed no later than Dec. 31, 2010.
During 2010 mortgage rates dropped—significantly. During August 2010 it was possible to lock in a 15 year fixed-rate loan under 4%. We haven’t seen interest rates this low for 50 years.
Short Sales seemed to be the only transactions getting done, but Short Sales frustrate many agents, Sellers and Buyers.
Terri Cantrell, REALTOR® for Century 21 M&M Oakdale, states that “Short Sales are hard to close. For whatever reason, the banks put up numerous road blocks, which strings the process out over several months (sometimes years), and Sellers get tired of the process and back out.”
Scott Abell says that only about 50% of the Short Sales transactions close. For that reason Abell says, “My focus has been on equity sales.”
As for 2011 – The key to growth is job gains and consumer confidence. The general consensus is that – home prices may fall a little and climb a little, but the market will essentially stay flat. Many industry experts feel that mortgage interest rates will remain the same.
Lawrence Yun, Chief Economist for NAR says, “Home values have shown stabilizing trends over the past year, even as the economy shed millions of jobs, because of the home buyer tax credit stimulus. Now that the economy is adding some jobs, the housing market needs to steadily improve and eventually stand on its own.”***