Tax Credit Expiration Won't Deter Home Buyers

New York, NY, April 28, 2010--There are signs that the expiration of the home buyer tax credit won't deter home purchasers.

Among consumers shopping for homes, 65 percent said the end of the tax credits will have little or no effect on their interest in purchasing a home, according to a survey by Prudential Real Estate and Relocation Services.

Consumers remain unsure about the direction of the housing market, but are optimistic about real estate values, with 46 percent expecting prices in their area to increase over the next year. Just 12 percent expect prices to decline, the survey found.

Over the next five years, 79 percent expect prices to increase, and 20 percent expect prices to increase substantially.

"The survey underscores the key role the federal home buyer tax credits played in stimulating residential real estate market activity and the U.S. economy," James Mallozzi, chairman and chief executive officer of Prudential Real Estate and Relocation Services, said in a statement.

"It also shows that most consumers believe the market has hit bottom and are more optimistic about the future," he said.

Rising mortgage interest rates and unemployment were cited as the most important factors affecting consumers' decision to purchase a home, along with more stringent lending criteria and fewer mortgage-backed securities purchased by the Federal Reserve.