Have you been waiting for the right time to purchase a home? The planets may finally be aligned in your favor. Three factors have come together, to create an attractive buying opportunity.
More negotiable home prices
Historically low mortgage rates
First time buyer tax credit
More Negotiable Home Prices
At first blush, it doesn't appear that prices have softened, in Westport. Average selling price of a single family home remained flat, rising less than 1%, from $1,699,078 to $1,708,804, comparing 2007 and 2008. However, we see a different story if we just look at the 4th quarter, comparing similar size and style homes. The average selling price of a 3-4 bedroom, 2-4 total baths, 2,000-4,000 s.f., not new construction colonial, declined 10%, from $1,173,631 to $1,059,532.
Clearly, prices are becoming more negotiable. Additionally, the proliferation of short sales and foreclosures are placing further downward pressure on home prices. In all likelihood, we may not have hit bottom, but trying to time the market could mean missing out on a good buying opportunity.
Historically Low Mortgage Rates
As with home prices, there is no way to guarantee a given date when you will receive the absolute lowest mortgage rate. However, mortgage rates are currently hovering at historical lows. During 2006 and 2007, the national average rate for a 30-year fixed, conforming loan was in the low to mid 6% range. During 2008, national rates averaged around 5.5%. As recently as 2000, rates were over 8%.
While rates are subject to change, yesterday, January 29,2009, Jeff Jensen, a certified mortgage planner with Connecticut Home Mortgage, quoted the conforming 30-year fixed rate at 4.875% and the Jumbo 30-year, fixed rate at 5.875%. These rates coupled with softening prices are an attractive combination.
First Time Buyer Tax Credit
In July, Congress enacted the Housing and Economic Recovery Act of 2008. Included in the package was a provision for a $7,500 refundable tax credit, available for first time home buyers. In reality, this tax credit is more accurately described as a zero interest loan, repayable over 15 years. For the purposes of eligibility, first time home buyers include anyone who hasn't owned a principal residence during the past three years.
The credit is for 10% of the purchase price up to $7,500. The full $7,500 credit is available to taxpayers with modified adjusted gross income of $75,000/year ($150,000 for couples.) Partial credit is phased out for higher earnings.
To qualify, the homes must be purchased on or after April 9, 2008 and before July 1, 2009. The credit May also be used for new construction as long as the home is occupied by July 1, 2009
All of these factors, plus the enviable position of not having a home to sell, makes it a opportune time to purchase your home.
First Time Home Buyers - This is your market!
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Copyright © 2009 Marilyn Katz, WestportCTProperties.com, All Rights Reserved, Westport, CT, First Time Home Buyers - This is your market!
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Copyright © 2013 Marilyn Katz, All Rights Reserved