The impact of the homebuyers’ tax credit is fading from the market and so are the buyers. We must realize that in September, October and November of last year buyers were rushing to buy a home before the expiration of the original tax credit (November 30). There is no such impetus this year.
As evidence, this week’s Mortgage Bankers’ Association Weekly Application Survey showed that mortgage purchase applications were: well below levels seen prior to the expiration of the homebuyer tax credit, and is almost 40 percent below the level recorded one year ago.
At the same time, the Wall Street Journal reported: Housing inventories rose in many U.S. cities for the eighth straight month in August in a sign of the continued headwinds facing a soft housing market … Inventories nationally remain at their highest levels since November 2008.
We’re back to the theory of supply and demand. Demand is softening as the supply of homes for sale is escalating.
There will be tremendous downward pressure on prices throughout the rest of 2010 and going into 2011. You should sell as soon as possible if you are thinking of selling in that time frame. Don't think like some sellers......"Oh, I'll just wait until prices come back up in a year or two." They aren't coming back up that soon!