The home buyer tax credit now in effect provides tax relief of up to $8,000 for first-time buyers and up to $6,500 for repeat purchasers of primary residences. However, the window of opportunity for these benefits is approaching its expiration; buyers must have signed purchase contracts by April 30th, and have closed on their purchase by June 30th (credits were originally set to expire 12/1/09). So whereas the spring season typically kicks off in March and runs hot through May, this year may advance and accelerate the process by as much as two months. According to both the National Association of Realtors® (NAR) and Trulia, a national real estate search engine, the latter half of January and February will be very strong, March even more robust, and April should “really take off.” Many trade-up buyers who in the past would have timed their purchase based on school-year considerations may advance their buying plans.

What does this all mean? If you’re contemplating selling your home, there is the potential for higher than usual traffic between now and the end of April. You may want to consider beginning repairs and home improvements now. Buyers have only thirteen weeks (as of 1/22/10) to sign a contract to buy. For the move-up buyer who has to coordinate closing dates (on both a sale and purchase), the pressure is going to feel even more acute to meet the deadline. And complicating matters, according to NAR, the time it takes to process a home loan is now about eight weeks, two weeks more than it used to take. So, relative to the home buying tax credit, “time’s a’wasting’.’”

• First,  Congress recently voted to extend two home buyer tax credits: the $8,000 credit for first-time home buyers under contract by April 30, 2010, and a credit for repeat buyers who have lived in one residence for five consecutive years of the past eight.
• Second, interest rates on thirty-year home mortgages have recently fallen to below 5%, a rate not seen for over fifty years.
• Third,  banks continue to put newly foreclosed homes on the market, and there will be a good supply of foreclosed homes on the market for some time.

If you’re a buyer, use the Private Sale Partners website as your first source for homes that have been well-priced and well-prepared by our well-educated sellers! Use the search tool to define whether or not you’ll search for a foreclosed property. If you are looking at a foreclosed property listing, scan the listing details for the agent’s contact information. You’ll need to contact the agent by email to view the property, as foreclosed property listings don’t have access to the PSP Home Sales Hotline to take buyer calls.

Unfortunately, it is rare for a lending institution to notify Private Sale Partners when the property has been sold, so you may find that a foreclosed property you’re looking at has already sold, but keep at it! A good buy is worth some extra digging.

If you don’t find anything in your desired neighborhood on our site, then you may want to enlist the services of a professional agent in your search, usually at no cost, since sellers normally pay the agent’s commission. We hope you’ll contact one of the thousands of agents in the PSP agent network to help you in the search. They work with the well-regarded national agencies of:

• Better Homes and Gardens® Real Estate
• Century21®
• Coldwell Banker®
• ERA®
• Sotheby’s International Realty®

If it’s a foreclosed property you’re looking for, ask if there’s an agent in your local office who specializes in foreclosed homes. Our experienced mortgage bankers can also help you find the right broker and the right financing.

An FHA mortgage remains the best option for most home buyers. An FHA buyer must live in the home purchased, so you may qualify for a great deal on a foreclosure while an investor would not. Not only do FHA mortgages offer great rates and small down payments, FHA also provides additional loans under the 203K program which provide money for the fixing up that foreclosed homes often require.

Since late fall of 2009, investors have been aggressively bidding for foreclosed homes, driving prices up slightly. In the short term, prices are likely to come down again as more homes are foreclosed and the supply of homes increases.

If you’re a seller, this is also a great time to have your home on the market. Buyers will be out in force scouting for a good deal. You’ve got to price aggressively to compete with foreclosures on the market. But you’ll have an edge over most foreclosed homes, and you’ll be able to command a higher price if your home is well-prepared and it is obvious to a buyer that it will take less time and money to make it move-in ready.

If you are looking to buy or sell a home, the first quarter of 2010 may well be the best time ever to do so. Happy house selling or buying!