Attention 1st time Buyers

First-time buyers – A hot market segment

Historically low interest rates. Attractive home prices. Impressive inventory. And now an $8,000 tax credit for first-time buyers that can be used as a downpayment on a home.
What’s not to love about this unique scenario for first-time homebuyers in Florida? It’s no wonder this demographic is growing monthly.
Let’s look closer at why the first-time buyer market is so strong:
1. $8,000 tax credit. It’s hard to say “No” to free money, and that’s basically what the federal government is offering with very few strings attached. Better yet, the money can be used as a downpayment, thanks to FAR’s efforts to pass legislation in Tallahassee in April.
2. Other government incentives. The 2009 American Recovery and Reinvestment Act opens doors to affordable homeownership to people who had not been able to qualify for loans or hand over large downpayments.
3. Interest rates. Hovering around 5 percent, this means monthly payments are less than even last year for the same home.
4. A buyer’s market inventory. Nothing needs to be explained here. Everyone wants options and choices when making the most expensive purchase of a lifetime.
5. Price. Florida’s median sales price for existing homes in March 2009 was $141,300; a year ago, it was $201,700. Do the math.
6. Look who’s buying. In March 2009, first-time buyers accounted for more than half of all home sales nationally, with activity concentrated in lower price ranges, according to NAR.
7. Spending power. Many younger buyers have high starting salaries out of college. Talk about Bright Scholars!
8. Lifestyles. Many adults in their 20s are marrying, starting families and ready to purchase a home.
9. No contingent sales. First-time buyers don’t have to sell a current residence in order to complete the transaction.

“Given low home prices, plentiful supply, and affordable interest rates, it’s been an optimal time for entry-level buyers with a long-term view,” says Lawrence Yun, chief economist for the National Association of Realtors® (NAR).