First Time Home Buyers
I’ve complained about the Home Price Index on this blog plenty of times. It is not without flaws. It’s a national stat that completely misunderstands the dynamics of neighborhoods. The report has a 60-day lag so at the end of May, we’re only now discussing the the March report.
Still, for all of its flaws, the Home Price Index is watched because the government, banks and businesses all use the report as a very general forecast of the market. It’s just not related to the price that you will end up paying for that home.
The data shows values were higher by 0.3% and there were definitely variances by region in the February to March report:
- East South Central: +2.5%
- Mountain: +1.1%
- Middle Atlantic: -1.0%
Real estate is a local game. It doesn’t fit by state or region. The single-largest determining factor in how your negotiation plays out is whether there is a second offer. We saw more multiple offer situations in the end of April than we had at any time recently.
It’s fair to say that a few of the homes that went under contract during April’s expiration of the first time home buyer tax credit that sold for at least a few dollars more than they would have without a second offer on that same home. If that’s true, then it’s possible that we could also be seeing increases in the April, May and June reports. Of course, we’ll find out 60 days after the fact.
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