The South Florida real estate market is regaining dignity as flocks of first-time homebuyers snatch up dream homes in beautiful Palm Beach County. These homes, in the middle-class price range, are the same types of real estate in Palm Beach County that were out of reach a few years ago for this demographic.
For example, buyers of real estate in Delray Beach who waiting out the years of peaking prices are finding prices down almost 50 percent from the height of the South Florida real estate market in 2005 and down 34 percent since last year. Between March and April in Palm Beach County, the number of signed sales agreements climbed 134 percent.
On May 7, 2009 in an article published in the Palm Beach Post, author Barbara Marshall cites a few examples of home purchases made by teachers, firefighters, and other middle-class workers.
One couple purchased a 2,500-square-foot home in the Lakeview of the Landings neighborhood in the lovely community of Wellington for only $215,000. It would have cost approximately $330,000. Another couple bought a historic home for about $250,000 less than it would have been a few years ago. A third example took possession of a REO home for $90,000 when the previous owners were unable to pay the $250,000-mortgage payments.
First-time buyers are now accounting for 50 percent of all buyers in the area. Shoppers are looking for and finding great deals. As soon as the announcements for great deals are publicized, potential buyers must be ready to jump, putting in acceptable offers to beat the competition. Homes are disappearing from the market overnight.
Besides the extraordinary real estate prices, first-time buyers as well as those who have not owned a primary residence in three years, have the added incentive of the $8,000 tax credit offered through the 2009 Stimulus Bill. HUD-approved agencies may set up bridge loans up to $10,000 that are also helping buyers access the funds now. HUD allows the money to go to down payments and closing costs.
To claim the tax credit, the purchases must be completed between January 1, 2009 and November 30 inclusive. For filers who already claimed the 2008 tax credit, which was a loan, file Form 5405 to amend that tax return. The tax credit phases out for single buyers with a MAGI greater than $75,000 or married couples who earn more than $150,000.
Other incentives for first-time buyers are historically low interest rates, the large number of foreclosed properties on the market, and FHA loans requiring only 3.5 percent down.
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