Agree with everything you’ve said and would add that the $8,000 tax credit might push prices up by far more than $10,000.
As you know, if the full $8,000 is used by a zero-down FHA buyer, that buyer is now able to buy a $228,571 house if the seller offers a “credit” toward the closing costs. This is a buyer who would otherwise not be in the buyer pool.
It affects all FHA/3.5% down payment buyers all the way up the chain, too. Same potential price boost of $200K+ due to the free govt cheese.
If a buyer is planning to put 20% down and use the $8,000 as part of the down payment, it increases their spending power by $40,000.
Essentially, the credit boosted prices by giving everyone that additional spending power (I refuse to call it buying power), and it brought a whole bunch of otherwise unqualified buyers into the buyer pool. Just think of the artificial demand that created!
$40,000 is probably the very **minimum** boost to prices as a result of this tax credit. The true benefit (to SELLERS) is probably in the $100K-$250K range, and may be more, IMHO.
