April Home Sales Increased Due to Tax Breaks

During a time when home sales seem to be dwindling down, it looks like the federal government’s tax credits to entice homeowners worked to an extent.

A recent report shows that the sales of new homes increased by about 14.8 percent in April. According to the analysts in the housing industry, much of those home sales were due to first-time homeowners rushing to buy a home to take advantage of the huge tax credit which expired at the end of the last month. The U.S. Commerce Department reported that this was the largest increase in home sales since May of 2008. How’s that for a struggling housing market?

Another factor that helped increase home sales is the near record lows of mortgage rates that have held fairly steady for the last couple months. Both of these factors motivated many families to buy their first home and realize their dream. But are the incentives over?

According to Bob Jones with the National Association of Home Builders, there will be more incentives to encourage people to buy their first home and stop the cycle of renting or living with friends and family members. He says that mortgage rates will likely stay near where they are for awhile and the home prices probably aren’t going up anytime soon. Combined with the economy improving slightly, April could be just the beginning of a surge in the housing market.

Of the four major regions in the United States, three of them saw significant increases in home sales last month. The Midwest saw the largest increase with a 31.6 percent gain in sales. The South experienced nearly an 11 percent gain while the Western region had almost a 22 percent gain. The Northeast, however, stayed about the same and posted neither an increase nor a decrease in home sales.

Overall, the nation’s inventory of new homes that are available to buyers decreased in April to less than six percent. That equals a number that is about 212,000 new homes. That’s the fewest number of new homes that has been available on the market since 1968.

If you are looking for a new home, now is probably going to be one of the best times to jump into the market. The latest mortgage rates are back down to about 4.8 percent for a 30-year mortgage. For a 15-year mortgage, you can get rates around 4.25 percent. In addition, the average fees that homeowners were being charged have also gone down, making the overall price even cheaper. Get your application in today and take advantage of all of these financial benefits.