The National Association of Realtors®.reports that the sales of existing homes showed another gain in May, benefiting from the first-time buyer tax credit, May’s increase was the first back-to-back monthly gain since September 2005.
Lawrence Yun, NAR chief economist, stated “Historically low mortgage interest rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates,” he said. “First-time buyers also are being drawn off the sidelines by the $8,000 tax credit, which is helping to absorb inventory.
A survey in May showed first-time buyers accounted for 29 percent of transactions. The number of active buyers is nearly 10 percentage points higher than a year ago. “This is the time of year when we see large increases in the number of repeat buyers, who are benefitting from sales to entry-level buyers,” Yun said. “Investors appear less active, but are more prevalent in areas with large price corrections.”