The S%P/Case-Shiller U.S. National Home Price Index reported today by MSN Money showed a 7.2% rise nationally in existing-home sales in July, the biggest month over month increase since 1999. At the same time the Federal Housing Finance Agency quarterly report found prices in 300 cities fell less than 1% from prices in the first quarter. Most of these sales were in starter homes costing less than $250,000.
Analysts attribute the increased sales to the $8000 federal tax credit first-time buyer incentive, low interest rates, and the low prices brought on by the recession and the high foreclosure rate. The apparent stabilization of prices may indicate that the market may have hit bottom, at least in some regions of the country, and prices may be pushed up somewhat by the high interest of first-time buyers. There is pressure on Congress to extend the incentive until 2010 (it expires in Nov. 2009) and to cover buyers other than first-timers.
The obvious conclusion is that this is a good time for first-time buyers with stable finances to consider buying!