First-time homebuyers continued to desert the housing market in July, according to a new industry study released Monday.
Data compiled by Campbell Surveys and Inside Mortgage Finance, shows that first-time homebuyers accounted for only 39.1 percent of the home purchase market last month. Thats down from a peak of 48.2 percent as recently as March and the lowest level seen in at least a year.
The end of the tax credit has clearly had an effect, said Thomas Popik, research director for Campbell Surveys. First-time homebuyer participation is continuing to drop.
In contrast, purchases by current homeowners have little positive effect on the housing inventory, because they usually sell a house at the same time they are buying another.
Campbell polls more than 3,000 real estate agents nationwide each month to evaluate trends in home sales and mortgage usage patterns.
The company says while fewer first-time homebuyers in the housing market will likely put downward pressure on home prices in the late summer and fall, in the near-term, real estate agents are reporting stable prices overall for the month of July and rising prices for non-distressed properties.
An agent in Iowa commented, Once the free money [from the federal tax credit] was over, the market began to die. The sales that would have normally taken place over the summer took place in March and April to get the money. The residential market is dying-prices are gradually falling.
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