From the Record:
First-time buyers are searching for homes with a growing sense of urgency, worried that time is running out on an $8,000 federal tax credit.
North Jersey real estate agents say they’re seeing a surge of first-timers who want to close on a property by Nov. 30, the deadline for the credit. The rush has set off bidding wars and stirred up a normally quiet August market.
“We’re inundated,” said Paula Clark, an agent with Coldwell Banker in Hillsdale.
To meet the Nov. 30 deadline, buyers need to have a contract by around Sept. 30 because inspections, mortgage approvals and other details typically take about two months.
House hunter Stan Salazar of the Bronx, a 34-year-old assistant building superintendent, said that he and his wife, Marianela, were drawn into the real estate market mainly by lower home prices. But they’d like to close in time to get the credit, he added.
“Hey, $8,000 is $8,000,” Salazar said, after touring an expanded Cape Cod in Fair Lawn Thursday afternoon with real estate agent Sheldon Neal of Re/Max in Oradell.
“It has pushed some of the buyers who have been watching the market into action,” said Abby Ceres-Buda, an agent with ERA A.J. Cali Real Estate in Hawthorne.
While $8,000 may not seem like a big deal when you’re talking about a purchase that typically runs $300,000 and up, it’s enough to get some cautious home shoppers off the fence.
“It’s not that much, you would think, but these are young kids starting out, so every little bit helps,” said Annekee Brahver-Keely, an agent with Russo Real Estate in Teaneck.
The tax credit is just one reason. First-time buyers are also attracted by lower home prices — down about 20 percent in the region from the market peak in 2006 — and mortgage rates in the 5.5 percent range. In addition, unlike trade-up buyers, they don’t face the obstacle of having to sell a house before they buy.
Still, the approaching tax credit deadline has heightened interest recently among first-time buyers.
Harry Elias, an agent with Friedberg Properties in Cresskill, said he got a call recently from a young couple eager to start the house hunt, after watching friends buy their first home. They saw that completing the sale could take two to three months, and want to close in time to qualify for the credit, Elias said.
The influx of first-timers has led to multiple offers on houses in good condition. In addition, more properties at the lower end of the market are selling at or near their full asking price, agents say.
Other buyers have been trying to buy for several months, but have lost out as the competition heated up in the starter-home market.
“We’ve had bidding wars on some houses, especially in the $400,000-$450,000 range,” said Jeana Cowie, a Re/Max agent in Oradell.
Now they worry they won’t be able to find a place and close in time.