Real estate agent Sandy Daly says several big question marks loom over the housing market for 2010.
Tax credits of $8,000 for first-time homebuyers and $6,500 for certain other homebuyers will expire April 30, with closings required by June 30, and Daly says the federal government is not in a position to extend the program. “About 47% of all homebuyers in 2009 were first-time homebuyers,” says the broker for C.J. Brown Realtors on Sherwood Forest Boulevard and recent past president of the Greater Baton Rouge Association of Realtors. “What’s going to be the catalyst to get that group to continue to buy, we don’t know.”
Further, the Federal Reserve plans to stop buying mortgages in March, which could spur a rise in interest rates that are at notable lows—about 5.2% for a 30-year, fixed-rate mortgage earlier this month. “How high will they go and how quickly will they get there?” Daly says. “That restricts your pool of buyers who can buy a home.”
Another unknown is the impact newly foreclosed homes will have on the market. While several banks in the past month put 90-day moratoriums on foreclosures, others such as Citigroup along with Fannie and Freddie Mac held off just through the holidays.
Although Daly says Capital Region property values were less hurt during the recession than elsewhere, even people who can buy a home are being cautious because of job-loss worries. “People are sort of staying put,” she says. “‘I don’t want to bite off more than I can chew later on.’ Fear is a factor.” See the full story here.—Todd R. Brown
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