Hoboken Real Estate: What will happen when the tax credit ends?

The Pending Home Sales Index continues to climb. However, will it continue after the first-time home buyer tax credit runs out on November 30? According to the National Association of Realtors (NAR), the Pending Home Sales Index rose 6.4 percent in August, which is the highest level we’ve seen since spring of 2007. The Index has now risen for seven consecutive months and will most likely continue through November.

So what’s happening in the Northeast? The Pending Home Sales Index, which is based on contracts signed to purchase a home, rose 8.2 percent, almost 2 percent above the national average. According to the Hudson County Multiple Listing Service, in our area there are 558 Hoboken condos up for sale with approximately 150 condos under contract, which is 27 percent.

What’s behind this upswing? Of course one obvious response is the first-time home buyer tax credit. Time is running out for buyers to close before the deadline comes. According to NAR, one and a half million buyers have already taken advantage of this tax program and many more are scrambling to get under contract now since escrow can take forty-five days on average to close.

But what happens after the first-time home buyer tax credit runs out…? This is a great question with numerous answers depending your personal situation! For example, for the first time buyer with a individual income of $75,000 or less annually or a combined income of $150K or less for married couples, it’s an additional 8K in their pocket! In contrast, for the buyer who has owned in the past 3 years and/or earns more than the maximum income guidelines, extending the credit will have very little ‘direct impact’ to their personal situation. With regards to the sellers, the answer becomes more complicated. If your considering selling your home in the near future I would suggest calling me immediately at 201-427-1032 for a personal and confidential conversation in regard to the impact of the credit.

In this real estate market finding experienced real estate help is essential. Please contact Sean T Shallis at The Shallis Group for a personal consultation on your buying or selling needs at 201-427-1032.