Rock-bottom interest rates and an $8,000 tax credit make a home possible for many first-time buyers — with no trick mortgages or financial gymnastics required.
MSN Money A triple play like this one probably won’t happen again in your lifetime:
Money’s cheaper than dirt.
Home prices have been knocked back to 2003 levels.
The federal government wants to pay you up to $8,000 for buying a house.
With that tax incentive, average credit and less than $2,500 in savings, it’s possible to buy a $150,000 starter home for about $1,000 a month, taxes and insurance included.
“It may be the best time to buy a home that we’ve seen in this generation — for everybody but particularly for first-time homebuyers,” says Brad Blackwell, a national sales manager for Wells Fargo Home Mortgage. The flood of homes for sale is hard on sellers, but it gives buyers an unusually wide selection, he points out.
It’s a memorable moment for responsible buyers who’ve been waiting to own a home. While the new tax credit is just the kicker some buyers have needed, historically low interest rates take some risk out of buying now. Waiting for lower prices might be a false economy if you lose a great rate. The monthly payments on a $200,000 mortgage at 5% and a $180,000 loan at 6% are about the same.
