Tax credit end does not mean the end of opportunity

Last week we took the opportunity to visit several of the agents who sit open houses daily in subdivisions with homes for under $150,000. These same subdivisions were a flurry of activity in the waning days of the expired $8,000 tax credit.

"Have you been busy?" we asked. The answer was unanimous. "Things have slowed since the end of April and the tax credit." Well, that was to be expected, but how important was that credit?

If you are one of the many lamenting the passing of the credits, let's do a little math.

A chart of average mortgage rates shows that at the end of April, mortgage loans were running around 5 percent. Last week the FHA rate was 4.5 percent. With that information, we can do a quick calculation and we find that a half-percent savings in interest on a $150,000 home with a 30-year, fixed rate mortgage will save the buyer, $16,274. That is more than double the tax credit and you can save that starting right now.

You may be thinking that the credit was your ticket to getting the down payment for a house. Right now, there are zero down payment loan programs available, programs that allow you to borrow your down payment, 3.5 percent FHA loans or conventional loans with just 5 percent down.

Frankly, with the interest rates low, down payments low and a Kootenai County average home price that is still 8 percent below last year, there is plenty of opportunity to save and save big.

Even though the credits are gone, we continue to perform well beyond last year in number of homes sold. Preliminary statistics show that by May's end we continued to be 34 percent ahead of 2009 with homes sold year to date. These are single family homes on less than an acre. At the end of May last year we had sold 514 homes in the county. This year, as of May, we had sold 690. We are just slightly below our 2002 performance. 2002 was the year that showed a significant increase in activity that peaked in 2005.

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Envision a slow moving roller coaster going up, down and back up again and you will get an idea of where we are today. Our chart of activity shows a slow but steady climb for the second time in 10 years.

Outside Kootenai County, sales are increasing as well. Overall reports of Multiple Listing Service areas show sales numbers up 37 percent from 2009. Number of sales increased from 585 in 2009 to 800 as of May 30, 2010.

Obviously, many are seeing the opportunities that today's real estate market has to offer.

Although the first knock may have been the tax credit, opportunity is still knocking. No one knows for sure how long.

For a safe trip home, call a Realtor. Call your Realtor or visit www.cdarealtors.com to search properties on the Multiple Listing Service or to find a Realtor member who will represent your best interests.

Kim Cooper is a real estate broker and the spokesman for the Coeur d'Alene Association of Realtors. Kim and the association invite your feedback and input for this column. You may contact them by writing to the Coeur d'Alene Association of Realtors, 409 W. Neider, Coeur d'Alene, ID 83815 or by calling (208) 667-0664 with your questions or commentary.