A Good Time to Buy?

When Shawn Scanzani placed a diamond ring on Rachel Baker’s finger nearly a year ago, the couple began planning for a future beyond Scanzani’s cramped apartment. They knew they wanted to stay in the Hudson/Litchfield, New Hampshire area, near their work and both extended families. Baker, a middle school teacher and Scanzani, a diesel mechanic, researched their options. They came home this fall to a three-bedroom, two-bath Cape, at a price and interest rate they could afford, just blocks from Baker’s parents in Hudson.

Is now a good time to buy? Baker and Scanzani, who took advantage of a buyer’s market and the Federal tax credit, think so. “When were we going to get a better chance, on a school teacher’s and mechanic’s salaries?” she asked.

The Federal tax credit alone, up to $8,000 on the purchase of a house, made 2009 a good time to purchase a first home. While the credit runs out at the end of November, many agencies, including the National Association of Realtors, are encouraging the Obama administration to extend the credit to all home sales — and through 2010.

The other key to the buyer’s market? Lower prices. New Hampshire’s median sale price for a single-family home dropped in August 2009 from $237,000 in August 2008 to $221,950, a 6.6 percent drop. The year-to-date sale prices dropped from $240,000 in 2008 to $213,000 in 2009, or 11.3 percent. In Baker and Scanzani’s area, Hillsborough County, the average home price dropped 5.9 percent, from $255,000 to $240,000.

According to the National Association of Realtors, the average home on the market is a third cheaper than it was three years ago. In New Hampshire, the median sale price in Coos County, the state’s least expensive housing market, dropped from $114,250 to $70,000, a 38.7 percent change. Rockingham County, home of some of the state’s most expensive housing, saw its median sale price drop 11.9 percent, from $295,250 to $260,000.

Inventory is still healthy, with 11 months’ supply of New Hampshire housing at the end of August. A balanced market is seven to eight months’ supply, and anything over that is considered a buyer’s market. But buyers should act quickly, as the supply is dropping. At the end of June 2009, the National Association of Realtors reported 3.8 million unsold homes on the market, down significantly from last June’s 4.5 million.

The Veterans Administration loans put a generation of families in starter homes after the Second World War, and the prrgram is still viable today. Veterans with 90 days of active duty during wartime, 181 days of active duty during peacetime, currently on active duty, or their surviving spouses can receive home loans with no down payment, no PMI and competitive interest rates. Vets or their survivors can get up to three quotes from approved lenders online. And VA loans can be combined with Federal products such as the tax credit.

There are also homegrown products, such as the New Hampshire Housing Finance Authority, which has been connecting people with New Hampshire real estate for a quarter century. NHHFA’s Single Family Mortgage Program provides buyers with first mortgages at below market rates, one point or no points, low down payments and occasional cash assistance. Your income and the purchase price must not exceed a certain amount, depending on where the house is located.

The prices are right, the interest rates are low, and agencies such as VA and NHHFA are available to those who need a boost. You do the math — and like Baker and Scanzani, you may find this is your time. A Prudential Verani Realtor can help you find the home that’s right for you.