By Laura Rubinchuk
So it’s the week after the tax credit deadline…have you noticed a change yet in behavior? While real estate is local, our inventory in the Washington, D.C. metro market got eaten up in April as people made the final push to qualify for the free $8,000. We’re down 25 percent in inventory levels since this time last year and we were seeing multiple offers more often than not. If there weren’t multiple offers, things went under contract in the first weekend it was on the market. Literally FLYING off the shelves. So how do I feel about the tax credit expiration?
I’m OK with it. I think the tax credit did its job for the duration it was being offered. It definitely was an incentive for some people to get into homeownership, it undoubtedly created a sense of urgency in April, and it spurred activity. But I’m glad it’s over. It’s time for the market to self correct now. Prices in our area are stabilized, if not increasing. We’re in a balanced market since the tax credit helped us sell through idle inventory that was lingering.
The real question is “now what?” Do you think the market will die for a short period while people reevaluate if it’s still the right time to buy, now that they don’t have the $8,000 incentive? Do you think affordable properties were picked up? If you had to guess, what will happen to your market now that it’s over for everyone except military (who are still eligible through April 30, 2011)?