The first time home buyer tax credit is definitely doing what it should be doing as sales for homes in that price range have surged over the past 30 days. A look at the numbers is revealing, there were 150 home sales in March 2009, 170 in March 2010 but at the time of this post, there are 453 homes under contract. 200 of those homes are below $250,000. The numbers for new construction are impressive as well, take a look at the chart below:

Not only has there been a surge in contracts but 22% of all homes pending are new construction. Builders have been able to pick up great deals on developed lots, build in the first time home buyer price range and sell quickly. So quickly in fact that they haven’t really be negotiating on offers. It’s been a few years since any builder has been able to say; “if you don’t like the price that’s fine, the next guy will”. But they might be singing a different song in a couple of weeks.

Their numbers have been driven almost exclusively by the tax credit. Of the 98 new homes under contract, half have been under $300,000 and nearly a third under $250,000. Once that tax credit expires at the end of April, then the buyer traffic in that price range will slow down considerably. Keep your eyes out for new builder incentives starting in May to compensate for that slow down in traffic.