Iowa homes sales dropped 4.9% between September and October, according to the Iowa Association of Realtors. Members of the organization reported 2,822 sales last month, down from 2,922 homes in September.
I.A.R. president Carey Jensen of Council Bluffs believes buyers and sellers were taking a “wait and see” approach. “I’m sure it probably has something to do with the timing of the initial expiration of the First-Time Homebuyers Tax Credit,” Jensen said. “I think people were a little more aggressive in the earlier months because they were afraid to wait until October or November for fear of running out of time.”
The federal tax credit was set to expire at the end of this month, but it has now been expanded through April of next year. In addition, the tax credit program is being expanded to included home buyers who have owned their current home for at least 5 of the last 8 years. Jensen believes the program’s extension and expansion will boost activity in Iowa.
“There’s definitely a possibility that we would have an increase in the number of listings, which would increase inventory for buyers that are currently in the market,” Jensen said. “Possibly more people will consider becoming first-time homebuyers and then we’re now able to introduce another group of buyers who would be ‘move up buyers.'”
On average, homebuyers in Iowa are spending around $6,000 less than they did one year ago. Jensen says the average sales price in October was $136,560. That’s down 4.4% from last year at this time. The average days on the market in October was 99 days, nearly unchanged from a year ago.