Effect of Tax Credits Comparing Sold Homes versus the Previous Year Same Month
Looking at the number of sold properties helps to shed some light on the effect of the Tax Credits on the Real Estate Market. After all, the reason for the Tax Credits was to help spur the Real Estate market which in turn would help spur the economy as a whole. I learned in Economics at Miami University it takes a minimum of 6 months for the economy to show it's reaction to anything the government does. So even with the information at hand, the jury is still out on what impact the Tax Credits had on the Housing Market, and the economy as a whole.
Because November 2009 was originally scheduled to be the end of the Tax Credits, we can take a look at November and after as an indication. As we can see from the chart, the Cincinnati market sold 406 more homes in November of 2009 than in November of 2008. Because of the jump in the number of solds from October to November it seems logical to say the threat of the Tax Credits ending did spur November sales.
The question I have is, did November sales simply steal sales from January/February? Those 2 months lost a combined 252 sales over the same time period a year ago. So did the Tax Credits ADD sales, or simply MOVE sales? I don't think we will know for sure until later in the year the effect the Tax Credits had on the economy, but we CAN see the effect on the housing market.
What about your market? Did your market experience similar peaks and valleys? This is only the Cincinnati Ohio market. Did your market see a spike in November only to have negative numbers in the months that followed?
Scott Baker, ABR e-Pro Realtor 513-403-5323. Visit www.ScottBakerHomes.com
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