*1. Don’t buy if you don’t plan to stay*
If you can’t commit to remaining in one place for at least a few years,
then owning is probably not for you, at least not yet. With the
transaction costs of buying and selling a home, you may end up losing
money if you sell any sooner — even in a rising market. When prices are
falling, it’s an even worse proposition.

*2. Start by shoring up your credit*
Since you probably will need to get a mortgage to buy a house, you must
make sure your credit history is as clean as possible. A few months
before you start house hunting, get copies of your credit report. Make
sure the facts are correct, and fix any problems you discover.

*3. Choose carefully between points and rate*
When picking a mortgage, you usually have the option of paying
additional points- a portion of the interest that you pay at closing- in
exchange for a lower interest rate. If you stay in the house for a long
time- say three to five years or more- it’s usually a better deal to
take the points. The lower interest rate will save you more in the long run.

*4. Hire a home inspector*
A home inspector can let you know if you’re about to buy a lemon of a
house or warn you about potential problems. At best, you can move into
the house confident that it’s in good shape; at worst, the inspector’s
report can let you back out of the deal if the house has major,
unexpected problems. Most typically, the home inspection can allow you
to negotiate the home price to account for necessary repairs.

*5. Get professional help*
Even though the Internet gives buyers unprecedented access to home
listings, most new buyers (and many more experienced ones) are better
off using a professional agent. Look for an exclusive buyer agent, if
possible, who will have your interests at heart and can help you with
strategies during the bidding process.

*6. Bonus Tip: Be patient*
Buying a home is one of the largest purchases most people will make in
their lifetime. The key to avoiding buyer’s remorse is to be completely
comfortable before signing on the dotted line.

Lawrence Yun, NAR chief economist, said favorable affordability
conditions have been working with the tax credit. “Clearly the home
buyer tax credit has helped stabilize the market. In the months
immediately following the expiration of the tax credit, we expect
measurably lower sales,” he said. “Later in the second half of the year,
and into 2011, home sales will likely become self-sustaining if the
economy can add jobs at a respectable pace, and from a return of buyer
demand as they see home values stabilizing.”

The PHSI in the Northeast declined 3.3% to 75.1 in March but remains
27.2% higher than March 2009. In the Midwest the index increased 1.2% to
98.9 and is 18.5% above a year ago. Pending home sales in the South
jumped 12.7% to an index of 121.2, which is 28.3% higher than March
2009. In the West the index rose 1.9% to 99.9 and is 8.8% above a year ago.

“Another encouraging sign is the improvement in the availability for
jumbo and second-home mortgages,” Yun said. “As bank balance sheets
strengthen, it is just a matter of time before lending of
non-government-backed mortgages steadily opens up.”

The National Association of Realtors, “The Voice for Real Estate,” is
one of America’s largest trade associations, representing 1.1 million
members involved in all aspects of the residential and commercial real
estate industries.

The Pending Home Sales Index is a leading indicator for the housing
sector, based on pending sales of existing homes. A sale is listed as
pending when the contract has been signed but the transaction has not
closed, though the sale usually is finalized within one or two months of
signing.

The index is based on a large national sample, typically representing
about 20% of transactions for existing-home sales. In developing the
model for the index, it was demonstrated that the level of monthly
sales-contract activity parallels the level of closed existing-home
sales in the following two months. There is a closer relationship
between annual index changes (from the same month a year earlier) and
year-ago changes in sales performance than with month-to-month comparisons.

An index of 100 is equal to the average level of contract activity
during 2001, which was the first year to be examined as well as the
first of five consecutive record years for existing-home sales.

For more information, visit www.realtor.org ^[2] .

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This past November, Congress elected to expand the home buyer tax credit to repeat buyers after seeing the success the temporary financial incentive had on the housing market and overall economy. As a result, current homeowners who will have lived in their home for 5 consecutive years out of the last 8 may now be eligible to receive a $6,500 tax credit.

“The expanded tax credit offers a great financial opportunity for existing homeowners, particularly those looking to trade up,” said James M. Weichert, president and founder of Weichert, Realtors, one of the nation’s largest independent real estate companies. “Not only can you receive a large sum of money from the government, you’ll also likely purchase your next home for less money and at a lower interest rate than you could have in years past or years to come.”

To qualify for the tax credit, the repeat buyer must have signed a binding contract by April 30, 2010 and close on the home by June 30, 2010. Tax credit eligibility is subject to income limits, $125,000 for single buyers and $225,000 for couples. In addition, the sale price of the home being purchased can not exceed $800,000.

There is no requirement that existing homeowners must have sold their home to be eligible for the $6,500 tax credit. However, Weichert encourages existing homeowners who want to benefit from this incentive to move quickly, particularly those who prefer to first sell their current home before purchasing a new one.

“Typically, it takes three months or longer to sell a home. That’s why it is critical repeat buyers put their home on the market right away. Otherwise they might not leave themselves enough time to both secure a buyer for their current house and find a new home by the April 30 deadline,” added Weichert.

Notice from yesterday…. The US Senate voted 98-0 to pass the Homebuyer Tax Credit [within the Unemployment Bill]. It now goes to the House. We expect the House to pass the bill as well and it could go to the President for signature within the week.

Passage of this bill would be wonderful news for the real estate industry in Washington. In essence, the bill extends the $8,000 first-time homebuyer credit through April 30, 2010 and provides a $6,500 credit to new purchasers who have lived in their current residence for five or more years.

According to Senator Patty Murray, “Extending and expanding the successful homebuyer’s tax credit will help families purchase homes and will provide a much needed boost to the local housing market”.

Download Bill Details

Thank you REALTORS for contacting your Senator and urging them to support this bill. Over 25 percent of our members responded to the call to action and helped push this bill through the Senate. Washington REALTORS are preparing a public relations plan to promote the extension if/when the bill becomes law.