Why It is STILL Great to Be a First Time Home Buyer

Real Estate Agent with Restaino & Associates

Tax Credit Expiration = Great Time to Be a First Time Home Buyer!

With tons of houses on the market, it just seems logical that you would be able to find the home of your dreams, at or below your price range, in your ideal neighborhood.....and all with just going to a couple of Open Houses. Two weeks max, and you would be at the closing table, ready to accept the keys to your first home!

Yeah, right. On average, it takes first time home buyers 18 weeks to find a home, as opposed to 10 weeks that repeat home buyers take for their home searches. Most first time home buyers take a while to get their bearings while looking at homes, not quite sure what they like and what they don't, and it does take a few trips out for them to formulate what they really want in a home. When I get feedback from other Realtors on my listings that are perfect for first time home buyers, I always sigh a bit when I hear, "They liked the home, but it was out first time out looking. We'll keep it in mind." Yes, sometimes first time home buyers find their dream home right away and quickly submit an offer, but the majority of the time that doesn't happen, even if it is their ideal place.

Now, let's talk about you. You missed the tax credit deadline and therefore missed the $8,000 tax credit. Are you screwed? Not hardly! Without so much competition from the other first time home buyers out there who have already submitted their offers, you are in a great position to negotiate with sellers who may be worried that you are their last chance for this year. In addition to that, you can expect to see home prices declining slightly in response to the tax credit expiration (and the shadow inventory of foreclosures about to hit the market....but that's a story for another day, gentle readers), so while you may not have that cash in your pocket from Uncle Sam, you may break even with a lower purchase price and solid term negotiation.

So don't be discouraged! It is still a great time to be a first time home buyer, and just because the tax credit expired does not mean that you should suspend your home search whatsoever. With so many properties on the market, your perfect home is out there and ripe for the picking!

Comments (4)

Debbie Cullen
REMAX Realty Team-Cape Coral, FL - Cape Coral, FL
Your Cape Coral, FL Specialist

it is always a great and exciting time being a first time homebuyers......

Best wishes for continued success!

~Deb Cullen, Century 21 Sunbelt, Cape Coral FL (aka...Paradise), 239.233.2322, www.CapeDeb.com

Aug 02, 2010 02:17 AM
Ira Bodenstein
PNC Mortgage - Montclair, NJ
NMLS#: 445143


Very nicely stated.  As I like to say a new buyer walking into your office does not know what rates were or what prices were last week, last month or last year.  Their only concern is what can you do to help me purchase a home today.  No sense being concerned about what was.  We need to be concerned about how we can assist buyers today.

Aug 03, 2010 03:29 AM
Dave Leiderman
Keller Williams Realty of Delmarva - Ocean City, MD
ABR, SRS, SFR - Realtor - DE & MD Beaches

I couldn't agree more.  In some ways, the tax credit has worked against potential first timers.  They're discouraged and feel that they've missed their window of opportunity now that the credit program has ended.

Most - and I would venture to say nearly all - potential first time home buyers, don't know where to turn, where to get their answers.  Its a matter of changing their mindset.

As you said, there is less competition from other 1st timers now.  Also, most locales/states have always offered a waiver or credit for one's first purchase; the interest rates are better now than they were during the tax credit period; there is still a glut of inventory out there which means this is still a buyer's market.

There are many reasons for first timers to start their search now.  Now that I think of it, might be time to create a blog about this on my own site.  Thanks for bringing this to light!


Aug 11, 2010 12:54 PM
Heidi Tiefenthaler
Restaino & Associates - Madison, WI

Glad I inspired a blog post, Dave! I can also see the home buying season starting earlier next spring with the first time home buyers who wanted to get in on the tax credit, couldn't make up their minds on a home, got discouraged, and want to give it another try.

Aug 11, 2010 01:26 PM