According to a survey conducted by Prudential Real Estate from April 15-30, 2010, the expiration of the Federal First-Time Buyers Tax Credit program on April 30th is unlikely to put off buyers looking for homes.
While buyers remain unsure about the direction of the housing market, the survey reveals that they are optimistic about real estate values with 46% of consumers expecting real estate prices in their area to increase over the next year. Over the next five years, 79% expect real estate prices to increase, with 20% expecting prices to increase substantially.
Survey respondents identified concerns about rising mortgage interest rates and uneployment as the most important factors affecting their decision to purchase a home, along with more stringent lending criteria and fewer mortgage-backed securitieies purchased by the Federal Reserve. The expiration of the tax credits place lowest on their list of concerns.
“The tax credits clearly helped stimulate the market when consumer confidence was low and housing inventory was high,” said Earl Lee, President of Prudential Real Estate. “ While the tax credit expiration is a concern for many, the bigger issues now are the availability and cost of financing as well as if they will have a job.”
In spite of the significant downturn in the real estate market, the survey underscores that the dream of home ownership and the perception that owning a home is a good investment remain intact.