Entering “Crunch Time”
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If you are a First Time Home Buyer and have been thinking of taking advantage of that Eight-Thousand Dollar Tax Credit in 2009, and you haven’t been pre-approved yet or started looking for homes with an agent, I’m afraid you may almost be too late.
Here in the Twin Cities Market we are finding a TON of first time buyers are looking to get closed on their homes before the November 30th deadline. Because most first time buyers can’t afford more than a $250,000 house, this means everything under a quarter-million bucks is selling like hot cakes (which apparently sell very fast!).
To be honest, it’s been somewhat frustrating as an agent working on many first time buyers’ behalf the past couple months. So many people out looking for a nice house, and so many homes going “Pending” faster than you can say “Offer”.
I did some quick research last night on the source of this recent hot market trend. Here’s what I found (which may help people realize what’s going on right now):
Looking at the number of homes on the market in the Twin Cities from 2008 to 2009, I noticed that the number of properties listed under $250,000 has DECLINED by 20% from July ‘08 to July ‘09. That means if there were 1,000 houses to choose from in ‘08, there are now only 800.
At the same time, the powers that be have tabulated that buyer Demand for homes in the Twin Cities has RISEN 15% during the same time periods. Now, this 15% is for all price ranges, not just under $250,000. I’d estimate that Demand for homes under 250k has probably risen somewhere between 20-40%.
So, with those two factors combined – Less Listings, More Buyers – we have shifted into a very busy market for these cheap homes.
Unfortunately a lot of these properties are either Bank-Owned or Short Sales, which means in some cases buyers are hanging their Eight-Thousand Dollar Hopes on the Asset Managers who help get these Short Sales approved with the banks. Needless to say, if you are waiting for a short sale to be approved and find out sometime in late September that it is Rejected, you may be S.O.L.
My advice: If you really think this is your time to buy, then get busy. Call a Loan Officer and Realtor NOW and start the process. Seriously, if you wait another 3 weeks you will actually be too late, unless you happen to be buying an expensive house or find an agent and loan officer who have nothing better to do in the next 8 weeks.
Best of Luck, and let me know if I can be of some help.
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What a great time for first time home buyers who are looking to purchase! There is certainly still time to get that $8000 tax credit, but you are right, it is crunch time!