Some people think that the real estate world came to an end on April 30, 2010. "Why should I purchase a home now when the tax credit expired at the end of April?" Homes sold before there were tax credits and homes will still sell after the tax credit.
Why will they still sell and why should I still be in the market? There are three reasons.
- Excellent affordability. Average and median sale prices in the Tucson metro area are at first quarter 2004 levels right now.
- Interest rates have fallen dramatically since April 30th. The following example illustrates how interest rates can dramatically increase your buying power. Think about it in terms of a $250,000 loan. The average interest rate in April was 5.34 percent, meaning that the principal and interest every month on a 30-year fixed loan would be $1,116 and cost $401,611 over the life of the loan. The average interest rate is currently around 4.75 percent, meaning that the average principal and interest payment on the same loan would be $1,043 per month and cost $375,588 over the life of the loan. By purchasing the same home right now versus in April, you would save $73 per month and over $26,000 over the life over the loan. Since the homebuyer tax credits ranged from $6,500 - $8,000, it is obvious that a lower interest rate will save you much more money in the long-run.
- There was a mad dash in April to purchase a home by the April 30th deadline so there is less competition out there right now, meaning that you have more homes to choose from and you have more negotiating power.
If you are interested in seeing what you can afford, give me a call and let’s get started. You can start by viewing listings for sale by clicking here:
http://www.david-winter.com/Search_MLS_Listings/page_240446.html
David Winter Associate Broker, e-PRO, GRI, SFR
Long Realty - Tucson, Arizona
http://www.David-Winter.com
520-990-3749
800-328-1575