First Time Home Buyers Return

Massachusetts has not escaped this down real estate market unscathed. In the first eight months of 2008, the median sale price for single-family homes was down nine percent from the same time last year. It's clear that this might be an opportune time for first time home buyers in some Bay State housing markets. The median sale price in Hyannis, for example, is down by over an enormous 40%. The foreclosure crisis has hit Hyannis like a Category 4 hurricane. With the declining housing market and increasing affordability, first time buyers are coming to Hyannis.

Utility, mortgage insurance, and homeowners insurance costs have increased substantially in last 12 months. Buyers are looking for any way to save on associated homeowner costs. The first time home buyer tax credit, recently passed under the Housing and Economic Recovery Act of 2008, should offer some assistance to buyers. However, don't get too excited over the phrase "tax credit". This credit is a 15-year interest-free loan payable yearly beginning two years after you claim the credit. The maximum allowed is $7,500 for a couple. Every year for 15 years, you'll be asked for $500 extra bucks on top of what you might already owe on your Federal tax return. This payment structure might present a problem for some buyers who struggle pay the government each April 15th. But, to first time home buyers who are accustomed to predictable tax refunds this might be welcome relief.