The first-time home buyer tax credit is due to expire next month. Anticipating the death of the credit, first-time buyers rushed to the market and
helped to push up September home sales. Of course, commentators anticipate that home sales will collapse as soon as the credit expires (call it the
cash-for-clunkers effect). From Bloomberg:
The $8,000 credit for first-time buyers, due to expire Nov. 30, has probably pulled sales and construction forward, signaling housing may cool in coming months. While Congress is considering extending the incentive, lower prices and mortgage rates have also contributed to steadying a market that endured the worst slump since the Great Depression.
“The rush to take advantage of the tax credit is obviously pushing up sales,” said Michael Gregory, a senior economist at Capital Markets in Toronto, who forecast sales would rise to a 5.5 million pace. “Although this is going to be temporary, it does absorb some excess supply and helps bring the market into balance going forward.”
The first-time home buyer tax credit is due to expire next month. Anticipating the death of the credit, first-time buyers rushed to the market and helped to push up September home sales. Of course, commentators anticipate that home sales will collapse as soon as the credit expires (call it the cash-for-clunkers effect). From Bloomberg:
