New Prudential study says low mortgage rates and falling home prices are more significant than tax credit.
Trends in New Hampshire underscore national survey data showing consumers more concerned about home prices, interest rates, and unemployment.
The 2010 Home Buyer Tax Credit incentive program was credited with stimulating the real estate market, but the 2010 Prudential Real Estate Outlook Survey (released April 28 by Prudential Real Estate and Relocation Services) shows that most buyers will not be deterred from purchasing a home without the $8,000 tax credit option on the table! That’s a good thing, considering the tax credit expires April 30.
“The federal home buyer tax credits clearly played an important role on a national and local level,” said Margherita Verani. “The survey data shows that overall consumers believe the market has hit bottom and are more optimistic about the future.”
Consumers are certainly noticing that shift. 70% of survey respondents said now is a “great” or “good” time to buy a home. And when asked whether the expiration of the home buyer tax credit would affect their decision to purchase a home, only 8% said it would make them much less interested in the prospect. The majority of respondents (65%) said it would have little or no effect on their interest in buying a house.
“While the tax credits clearly helped stimulate the market, the more pressing concerns of people looking at homes in New Hampshire area are the availability and cost of financing, as well as if they will have a job,” added Margherita. “Despite the market downturn, consistent with the national survey data, the majority of our clients are more confident and, importantly, continue to believe that owning a home is a good investment.”
The Prudential Real Estate Outlook Survey was administered from April 15-20, 2010, to 1,000 U.S. consumers with at least $35,000 in annual household income. Want more information? Read the full 2010 Prudential Real Estate Outlook Survey or view the supporting charts and graphs.