The tax credit extension is certainly great news for the Houston real estate market, but I believe that it will also have a positive impact on Houston Relocation. Since the economic downturn, I have assisted quite a few people who were relocating to Houston, but have had to lease “for a while” until their home sells else where. While the Houston real estate market has not suffered in the significant ways that more depressed markets have, it has still affected people moving from other parts of the country in terms of their ability to purchase a home in Houston.
Many transferees have been faced with difficulty in selling their homes prior to their relocation to Houston. As a result, we have been assisting a fair number of transferees who have chosen to lease a property in Houston until their home sells in the location they are leaving. For those transferees who either do not have buyouts, or are in short sale situations, they are unable to carry the cost burden of duel home ownership. Renting is often the best option and sometimes the only option for many transferees who have not yet sold their home before relocating.
So how could the expansion of the tax credit make a difference?
The Houston Chronicle has a great article today by reporter Nancy Sarnoff entitled: Expanded tax credit could keep the housing market moving. Now that the $8,000 tax credit has been extended until the end of April, Sarnoff says that this “could be a shot in the arm for the Houston-area housing market.” I couldn’t agree more! The article quotes Jim Gaines, an economist with the Texas A&M Real Estate Center, who says, ” The net effect of the extension and expansion of the tax credit will help boost sales.”
Per the article, the National Association of Realtors estimates that 350,000 homes were sold nationwide to first-time home buyers who probably would not have purchased without the tax credit. Gaines says that this may increase another 10 percent. This would be great news in Houston as well as for the rest of the country.
Sarnoff’s article also quotes Vicki Fullerton, chair of the Houston Association of Realtors, who also points out the positive impact that the tax credit potentially has on Houston Relocation. In the article, Fullerton says that she believes that the tax credit could also help people relocating to Houston sell their homes in slower markets.
The tax credit, which applies to homes prices up to $800,000, may help with higher priced properties in higher priced markets to sell, since the tax credit has been expanded to include both current homeowners, as well as first-time home buyers. If transferees are able to sell their homes in their previous location, then they will be able to move forward in purchasing a home at the onset of their relocation to Houston instead of having to wait, lease for now, and purchase later.
