Why Home Sales Dropped Dramatically in July from June Or Why Were We Surprised When Buyers Were Incentivized?

In the week of August 23, blasted throughout the news was existing home sales nationally dropped 27% in July from June. This was reported as the biggest monthly percentage decline on record. The Greater Phoenix residential market faired slightly better with a 24% decrease. A large percentage drop in July sales was expected for Greater Phoenix. Why The Large Percentage Drop for Sales in July Was Expected Why did sales drop in July? Because the affect of the tax credit(s) were worn out! Many buyers bought because of the two tax credits: The first time homebuyer’s tax credit up to $8,000 and the move up buyer’s tax credit up to $6,500. To qualify buyers had to be under contract by April 30, 2010 and close by June 30 (at the end of June the close of escrow date was extended to September 30). The April 30 deadline led to a surge of buyers going under contract in March and April. So, before you believe the Headlines in the News....look at the statistics...it's not all doom and gloom!