The wall street Journal stated in an editorial on Tuesday that April will likely mark the bottom of the housing slump. The housing boom made housing unfordable for many and took many buyers out of the market place. Couple that with a mortgage crisis and you get our current situation. Wall Street Journal states that the home prices are back inline while incomes have continued to grow and the reform of FHA financing has again made purchasing a home a little easier.
Even Better News for Utah
Of course in Utah we typically don't realize the housing crisis is 3 years old as we were not shaken nearly as bad as many parts of the nation. In fact I have earlier stated that CNN has reported that Salt Lake City is one of 6 major metro areas that has already begun a rebound and Forbes magazine has called our state #6 of 10 on the list of "Most Recession Proof Cities". There is also some other really exciting data straight from the MLS that indicates a healthy Utah housing market. For the first time since 2004, the number of homes sold has increased from March to April. This simply does not happen, even in a great market. There has always been a slight decline in April before jumping back up in May. This year there were 34 more homes sold in Salt Lake County in the month of April then in the month of March. The average sales price had a slight but healthy increase from $267,216 in March to $271,077 in April.
Rewarding First time Home Buyers:
The house is voting on a tax credit for first time home buyers as we speak. Most already know that mortgage interest, property tax, and at least for this year mortgage insurance is tax deductible. When used properly you can use the difference in your tax liability to decrease your monthly mortgage payment. The only flaw in this method is that you don't realize any of the tax benefits in the first year of buying your home. The House is trying to change that by allowing a one time tax credit of $7,500 to be taken in full on the tax return for the first year of the purchase. There are some conditions and this has not been approved yet, but this is some incredible news and really gives the first time home buyer some incentive to purchase a home aside from the tax deductions, equity growth, and all of the other wonderful not financial aspects of home ownership.
The Market Correction:
The market correction has been a great thing for us in Utah. Price increases have slowed, interest rates are incredible, loan programs have been reformed, and many that were practicing shady methods of doing business have disappeared. We are going to begin to see some healthy growth as more major companies begin to land here in Utah and our unemployment continues to stay below the national average. Home sales will increase as rental rates increase and our housing supply diminishes. This is a great time to live in Utah!
As always feel free to use the IM icon on the side of the screen to message me with any questions you may have about Real Estate.
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