Home Buying Mistake #5
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What’s more important - cost or price?
With so many moving pieces in the housing market these days, it may get confusing to know what is more important for buyers - cost or price? Are cost and price the same? Not necessarily. For an example, think in terms of buying a car. Most buyers can’t recall the actual "price" of the car they bought, what is more important is their cost - or the actual monthly payment. The same applies to real estate. For a buyer, it is not just the "price" of the home that can impact cost, the interest rate on the mortgage is also an important factor. So while the "price" of the home may fall, if mortgage interest rates increase then the actual "cost" of the home may vary, depending on the magnitude of the price decline and rate increase. Lots to consider here. If you are in the market to purchase a home - make sure you understand the difference cost and price and how that impacts your wallet. You may find that if you wait too long for prices to drop, your cost may actually increase with higher rates - and no one wants to increase their cost.
Is There Life After the HomeBuyer Tax Credit?
Now that we have passed the April 30, 2010 homebuyer tax credit deadline to enter a qualified purchase contract, the question becomes "Is there life after the tax credit"?
Survey Says!
One way to get a perspective on where the housing market is heading in Arizona is to ask those that are working with buyer and sellers every day. Long Realty Company recently conducted a survey of its agents to find out what their perception is on how much impact the homebuyer tax credit has had and in what direction the housing market will go for the balance of 2010.
Here is some background information on the survey:
230 Survey Responses
846 closed transactions reported in the first 3 months of 2010 by the respondents
606 pended transactions (in escrow, not closed) reported in the first 3 months of 2010 by the respondents
Survey Results
What percentage of your buyers will take advantage of the home buyer tax credit program?

Your average sales price for all of your transactions in 2010 is:

After the homebuyer tax credit ends on April 30, do you think buyer activity in your marketplace will:

So What Does It Mean?
Almost half of the agent respondents said that the tax credit will impact 0-10% of their buyers, and 58% of the respondents said they thought that buyer activity will stay the same for the balance of the year. While it is certain that the homebuyer tax credit has had some impact to the market, it appears that, at least from a Long Realty agent perspective, that it may not have been the primary driver of business so far this year. Agents feel that the right house at the right price with low mortgage rates are driving buyer activity, and that the tax credit has been a secondary incentive. Which, if true, means that those primary drivers of the housing market remain after April 30, 2010.
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| Address: 7050 E Sunrise Drive 4104 Tucson, AZ 85750 Directions: From Sunrise and Kolb, East to Pinnacle Canyon Condo entrance. Take right gate to building #4. Legal Description: Pinnacle Canyon Condominium Bldg 4 Unit 32 @ garage @ .691% Int in common elements |
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| Terms: Cash; Conventional |
Loan Information: |
| Remarks: Fully furnished remodeled ground floor condo and garage located in the luxury gated community of Pinnacle Canyon. This private 2BR/2BA treasure overlooks park-like grounds & features 1074 sqft, split bedroom floorplan, high ceiling with crown molding & a spacious master suite. Resort style common area includes heated yearround pool & spa, exercise facility, clubhouse, bbq areas, romantic fireplace and a soothing waterfall. Conveniently located. |
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James Servoss, Long Realty Company 6410 E. Tanque Verde Rd. Tucson, AZ 85715 jservoss@longrealty.com 520-603-1549 http://www.luxurytucsoncondos.com |
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