The National Association of REALTORS (NAR) reported in late February that existing housing inventory fell to a two-year low, a sign that excess inventory is being reduced across the country. Existing home sales — including single-family, condos, co-ops and townhomes — were down in January, falling 5.3 percent to an adjusted annual rate of 4.49 million units.

Nationally, qualified buyers are finding favorable mortgage rates hovering in the high 4 to mid 5 percent range for a 30-year fixed-rate loan. These historically low rates have created exceptional buying opportunities. According to Lawrence Yun, NAR chief economist, "The housing market will soon get a lift from very favorable buying conditions – not only from improved affordability, but also from the stimulus of an $8,000 first-time home buyer tax credit, and higher conforming loan limits that will allow more people to tap into 50-year low mortgage rates."

NAR anticipates an additional 900,000 home sales will result from the housing stimulus, and expects housing inventory to fall below an 8-month supply by year end. The reduction in inventory points to strengthening conditions in many markets across the country.

$8,000 Tax Credit Available
For a limited time home buyers can claim a special tax credit worth up to $8,000. The American Recovery and Reinvestment Act offers qualifying homebuyers a tax credit equal to 10 percent of a home's purchase price, up to a maximum of $8,000. The tax credit is offered to first time homebuyers, and those who have not owned a principle residence in the past three years. To be eligible for the tax credit, the home purchase must be recorded between January 1 through December 1, 2009.

The full tax credit is offered to buyers with reported income up to $75,000, or $150,000 for married couples filing a joint return. Partial tax credits are available to for those with income levels up to $95,000, or $170,000 for those filing jointly. Contact us today for more details on this exciting program!

Average (Mean) Sales Price of Existing Homes by Region
Date U.S. Northeast Midwest South West
2006 268,200 299,700 205,300 230,000 371,300
2007 266,000 307,100 200,500 225,600 365,900
2008 242,700 297,800 183,400 211,600 312,300

01/09 212,900 262,900 165,800 189,600 261,300

* statistics from the National Association of Realtors