There has been a fair amount of speculation on what the 2010 New England real estate market will bring.
The 2009 market brought lots of opportunities for buyers, and as a result home sales were up a record 44.1 percent in the past year, according to the National Association of Realtors.
Much of this stabilization in the marketplace locally was a direct result of the government tax credits utilized by homebuyers. In our recently released Re/Max of New England 2010 Housing Market Outlook and Forecast, we surveyed dozens of Re/Max agents from across New England to provide insight on the marketplace, both as a look forward into 2010 as well as a look back at 2009.
One of the busiest markets identified in Massachusetts was within the MetroWest communities where sales remained steady. The motivating factors were largely the federal tax credits offered to buyers. In particular, the inventory of affordable homes remained attractive to first-time homebuyers who continued to strengthen the market.
The general consensus in talking to our expert agents is the market will start the year out strong. With the Federal Housing Tax Credits still in play, buyers will remain motivated to cash in on these government incentives. Both first-time home buyers, who qualify for up to an $8,000 credit, and repeat buyers, who qualify for up to $6,500 under a newly established law, will continue to feed the market throughout the first half of 2010. Both government credits apply to sales occurring on or before April 30, 2010, with the purchase being completed by June 30.
That will bring us to the spring market, one that has historically been very strong. However, we’ll need to consider several other key elements that will contribute to how successful 2010 becomes. Realistically, there will be some challenges in the second half of the year once the tax incentives are exhausted.
Unemployment rates, interest rates, foreclosures and short sales will all play major roles in how the year ultimately shapes up. In 2009, the first half of the year was a struggle, but in the end, single-family homes in New England showed a year-over-year increase. I’m going to remain optimistic that the end result in 2010 will reflect steady activity in the MetroWest region with more people continuing to achieve the dream of home ownership.
Jay Hummer of Shrewsbury is executive vice president and regional director of Re/Max of New England in Natick.
