Mortgage rates floating around 5 percent.

Low Mortgage rates around 5 percent keep the demand for foreclosures strong

Buying a foreclosure property that is already deeply discounted is even more enticing with interest rates at record lows.

Five percent interest rates, first time buyer tax incentives that have been extended through April of 2010,  and low prices have buyers serious about making their home purchase.

Prices declining substantially in the low end markets is doubtful.

Interest rates are expected to stay low for a while.  When inflation starts to take hold interest rates will jump to 6.5 or higher.

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Tax credit incentive for first time home buyers to be extended

Great news for the Real Estate industry, especially first time home buyers.  To keep the real estate market viable the federal government is completing the process of extending the first time home buyer tax credit that is set to expire in November of 2009.    If a home buyer has not had a mortgage payment in the last three years they are eligible for a tax credit of up to eight thousand dollars from the federal government.  In other words, a person that would normally pay ten thousand in taxes would only have to pay two thousand in taxes.  This is great for first time home buyers and the real estate market in general.  With such amble supply of product many buyers seek tangible reassurance  that now is a good time to buy.  The tax credit provides the extra incentive that is bringing buyers off the fence and into the real estate market.   The tax credit will help to sell the over abundance of product which is key in calming the market and stabilizing prices.  The vast amount of homes for sale must be absorbed so that home prices can stabilize.

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