The number of homes sold in Iowa last month increased nearly 21% compared to May of 2009 according to the Iowa Association of Realtors.
IAR president Carey Jensen says a federal tax credit offered to both first-time home buyers and “move up” buyers clearly played a role in the sales boost. That tax credit is set to expire next week. “It accelerated some sales probably for June and July, so we’re seeing those numbers reflected in May,” Jensen said. “However, this is typically a better time of year for closings. We had such a tough winter…people were excited to get out and start looking for homes.” A total of 3,460 homes were sold last month. That’s up from 3,297 homes sold in April. Jensen believes sales activity will remain strong through the summer as Congress is expected to extend the tax credit through September.
“There are so many sales that are scheduled to close by June 30 that are just not going to happen,” Jensen said. “The banks and title companies are overwhelmed with the response to the tax credit, so I believe the extension will give us until September 30 to get those sales closed. So, I expect we’ll continue to see an upward trend through the summer months.”
The federal tax credit program provides up to $8,000 to first-time home buyers and $6,500 to “move up” buyers. The average sales price of homes in Iowa last month was just over $140,000.