If you have been following the media circus over the past year or so and in particular, the onslaught of news reports regarding the housing market, it is understandable to be very wary about listening to a real estate agent stating that it is “time to buy”. But the signs are there, and it isn’t just those involved in the real estate industry that are recognizing the opportunity knocking.

When is the last time in history that there has been this many incentives available to buy a home? Certainly the biggest incentive out there for those that qualify is the “First Time Homebuyer Tax Credit“, basically free money from the government, courtesy of the taxpayers. To qualify for the $8000 tax credit, buyers must not have owned a principle residence in the last three years and must close on their home purchase before November 30, 2009.  As long as they live in the home for three years, they never have to repay the tax credit. Additionally, there are income restrictions for this tax credit, as it  phases out for taxpayers whose adjusted gross income exceeds $75,000, or $150,000 for married couples.

But are there other reasons to buy now, particularly for those who do not qualify for the first-time homebuyer program? Absolutely. Home prices have dropped to levels not seen since the early 2000’s in many areas of the country, bringing the affordability for many homes back to a more reacheable level for many buyers. Particularly in the hard-hit areas of the housing crisis such as Florida, Nevada, California and Arizona, the inventory of homes for sale on the market is still way above the normal levels, giving buyers a significant selection of low-priced homes to choose from. And the interest rates available for those with good credit are still incredibly low — the average rate for a 30-year fixed mortgage was 5.12% last week, the lowest level since the end of May, according to mortgage giant Freddie Mac. How long will these low interest rates will last?  According to the chief economist for the National Association of Realtors, Lawrence Yun, the rising budget deficits are likely to push interest rates back up in the not too distant future. 

Are you convinced yet? If you are a first-time homebuyer, the final straw is that the deadline of November 30 is quickly approaching. And with typical closings taking periods of up to 60 days in the tightened credit and lending market, that does not give you much time left to find your ideal home and negotiate an acceptable offer.

Naturally, you will want to ensure that you consult a real estate professional in your local area to assess the market conditions in the area which you are considering making a purchase, as all areas might not be in the same state of recovery. But clearly in many areas of the country, and CIC’s home base of Phoenix, Arizona being one of these examples, the time to buy is NOW for all the reasons we’ve stated in this blog post.

Readers, any additional advice for first-time homebuyers in today’s market? Share your thoughts with a comment!

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