October 3, 2009

First-time home buyers scramble for houses

Bidding wars have broken out in the Boston area, as first-time home buyers eager to take advantage of tax credits compete for houses, real estate agents say.

The $8,000 tax credit is to expire next month, creating a sense of urgency, The Boston Globe reported.

Since sales must be finalized by Nov. 30 and real estate deals can take up to 60 days to finalize, prospective buyers of lower-price homes are pushing to sign purchase agreements as soon as possible. They are also driving up prices on the most desirable properties.

There is a shortage of affordable houses in the area, said John Schjolden, a real estate agent specializing in selling bank-owned properties. He said a two-family home in Dorchester brought in more than 30 offers, some significantly above the asking price.

David Shortsleeve, manager at Coldwell Banker in Worcester, said work to find homes between $150,000 to $250,000 has been unceasing since Labor Day.