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| Tippecanoe County Courthouse |
As I have written earlier, the residential real state market across our country was favorably impacted by the first time home buyers tax credit created by Congress in early 2009 and expanded to include "move up" buyers in November, 2009. In order for a buyer to qualify for the tax credit, an accepted offer on a home had to be in place by April 30, 2010 and the transaction had to close by June 30th. As it turned out, Congress extended the close date deadline to September 30, 2010 after the close of business on June 30th. [Note: the inefficiency of Congress at times causes one to scratch their head and wonder why]
We had a strong sense that a meaningful portion of our demand this winter and spring was driven by the tax credit, but it was hard to quantify. As the April 30th deadline to have an offer accepted approached, the local market reached almost a frenzied pace. Many Realtors worked late nights in the weeks preceding April 30th. It was wonderful! As we feared, on the days and weeks that followed April 30th, the number of showings and accepted offers dropped noticeable compared to last year, especially for it being so early in the year.
Now that we are more than one month beyond the initial closing date deadline for the tax credit, we can measure the number of closed units with and without the benefit of the tax credit. The numbers are pretty incredible. Year to date residential unit sales through May 31, 2010 in the Greater Lafayette area were 19% ahead of the same period last year. However, that is when the fun began to end. Residential unit sales in June were 12% below last year and July was 32% below July, 2009. On a year to year basis, year to date sales through July are 3% below last year.
We are currently in a slow season, measured by showing activity. However, what we are experiencing now is not uncommon for the back to school season. We usually see a bump in showing activity and Open House attendance after Labor Day. Let's wait to see what happens in September. I'll report back
