Local Real Estate Comments and Ramblings

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May 1, Will it be a hangover or mild headache?

May 1,  Will it be a full hangover or just a headache? 

Hangover - Mike Licht, NotionsCapital.com Flickr Creative Commons
Mike Licht, NotionsCapital.com Flickr Creative Commons

The current tax credit ends on April 30.  That is buyers need to be under contract by April 30 anyway. Many of us have seen a nice flurry of activity over the last weeks/months fueled by the current tax credit offer. I certainly like having the extra activity but I was opposed to the tax credit because its a short term boost and not a long term solution.  

So what happens when we wake up on May 1?  Hopefully at least some of the current buyers will stay in the market.  I believe that after the tax credit ends we see supplies going back up and prices edging their way down,  so it will still be a good time to buy.  But that does mean dropping prices and more homes for sale, just like it was before the tax credit ever started.

My prediction is that in the next few months, after the hangover sets in, the government will come up with a new even larger program to try to boost home sales. They will throw many at the problem instead of working on long term economic solutions like job creation. I hope that I'm wrong and on May 1 we wake up with just a mild headache.




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Bob Southard
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Comment balloon 7 commentsBob Southard • April 22 2010 08:44AM

Comments

Bob I believe the government will begin scrambling to come up with additional programs, particularly as we grow closer to the November election.

Posted by Dan Benefield (Benefield Realty) over 8 years ago

It will be May day -so we should all celebrate with a basket to our friends and neighbors.

Posted by Jody Lautenbach (Century 21 Premier Associates) over 8 years ago

Bob,

There is already a bill proposed in Congress with passage predicted by Memorial Day to extend the $8,000 tax credit. :)

Steve

Posted by Steve Hoffacker, Certified Aging In Place Specialist-Instructor (Steve Hoffacker LLC) over 8 years ago

I really wish there would just be an announcement that there will be NO more tax credits or other inducements.  Until that time, the market can't really begin to recover.

Posted by Lane Bailey, Realtor & Car Guy (Century 21 Results Realty) over 8 years ago

The SOONER these expire * state and federal * the sooner the market can recover NATURALLY and STRONGER

Posted by Wallace S. Gibson, CPM, LandlordWhisperer (Gibson Management Group, Ltd.) over 8 years ago

I agree with Wallace & Lane- The RE market needs to recover naturally without being on life support from the Govy.

I've heard a new tax credit is in the works and it will be $6500, who knows??

Keep in mind that for Active Duty military overseas from Jan 1st to April 30th the credit has been extended for a full year.

 

Posted by Melissa Anderson (Mortgage of Texas & Financial) over 8 years ago

Bob, Interestingly, we are still seeing good activity here.  We've received 3 offers on our listings in the last week so buyers are still out there even though the tax credit has expired. I've read some surveys from NAR of buyers saying now is a good time to buy with or without the credit.  I think that is true!

Posted by Michele Reneau, Realtor, GRI ~ Charleston, SC Relocation Experts Team (Certified Staging Professional (CSP) Elite Instructor) over 8 years ago

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