Interest rates are down, and first-time home buyers may be able to get a tax credit (10 percent of the purchase price of their home or $8,000, whichever is less). Read the complete story here.
The interest rates are still hovering around 5%, lower than we’ve seen for years. Expectation is that rates will rise steadily as the economy improves, so we don’t know how long the low rates will last. Home prices are down – not nearly as much as in the rest of the country, but prices dropped 5-10% in many parts of Austin over the last two years. Rates, prices, the tax credit – now is the time to, as they say in the stock market, buy low.
Buying a home is still also one of the best ways to save on taxes. Mortgage interest, real estate taxes, and usually mortgage insurance are all tax-deductible.
The low interest rates and tax incentives are good for both buyers – by making the purchase transaction more attractive and affordable, and for sellers – by stimulating the market for home sales. The National Association of Realtors has proposed the Congress pass an extension of the tax credit. Each home sold adds $40,000 plus to the economy. Some say housing brought the economy down, but housing could also jump-start the economy, adding jobs, stimulating retail sales of furniture, appliances, and building materials.
Contact me for more information about benefits for buyers and sellers.