New Hope for First Time Home Buyers

Housing prices fall

The S&P Case-Shiller Home Price Index, measuring housing prices in 20 representative cities across America, fell for the 30th straight month in January, bringing house prices down to 2003 levels. And this time it actually set a record, falling 19% from January 2008. "There are very few bright spots that one can see in the data," said David Blitzer, chairman of the index committee at Standard and Poor's. "Most of the nation appears to remain on a downward path, with...nine of the MSAs (metropolitan statistical areas) falling more than 20% in the last year." According to Mike Larson, a real estate analyst with Weiss Research, home prices won't start advancing until the overall economy picks up.

Home bargains galore

In total, prices have plunged 29.1% nationally since they peaked during the second quarter of 2006, but that of course doesn't figure in individual cities, where prices are more varied. Dallas is the least affected at 4.9%, and Phoenix lost the most, at 48.5% from its peak. All 20 index cities were in negative territory, but the biggest losers are Las Vegas, Miami, Phoenix, San Francisco, and San Diego -- each losing more than 40%. The bad, and good, news is that the rate of decline has picked up recently. As Mike Larson, a real estate analyst with Weiss Research says, ""Arguably, that's just what we need to drive up sales activity and reduce inventory.

In New Mexico, the governor signed a bill giving first time homebuyers a $6800 interest free loan to use for a down payment which can be paid back using the $8500 tax credit available from the feds. This is for first time home buyers and is available through MFA. It is a great year to buy a home.