place to hang art

Well it’s here. Remodeling magazine’s 2010-2011 Cost V. Value report.  Below are the top 5 projects that give home sellers the most “buyer buying” bang for the dollar. First impressions and kitchens matter most– same song new lyrics below. Great advice selling public!

HAPPY NEW YEAR!!

TOP 5: First Impressions Matter

Big-bang projects can make or break a sale from the moment potential buyers exit their car. A midrange entry door replacement brings the highest payback at a national average of 102.1 percent, followed by a midrange garage door replacement, at 83.9 percent, and an upscale redo of the siding at 80 percent of the cost. Step into the home, and a midrange kitchen remodel recoups an average 72.8 percent. Gaze into the backyard, where a wood deck addition also generates a 72.8 percent return. 

Also noteworthy in this slow-growing economy is that four of the top five projects are “midrange” projects aimed at budget-conscious sellers. If sellers still balk at the price tag, take note of our tips for completing the projects on a tidy budget. 

PROJECT 1: Entry Door Replacement (Steel)

Cost $1,218

Resale value $1,243

Cost recouped 102.1%

National averages 

What this project entails: Remove an existing 3-foot-by-6-foot-8-inch entry door and jambs and replace it with a new 20-gauge steel unit, including a clear dual-pane half-glass panel, jambs, and an aluminum threshold with a composite stop. The door is factory finished with the same color on both sides. Exterior brick-mold and 2.5-inch interior colonial or ranch casings in poplar or an equal choice are prefinished to match the door color. Replace the existing lock set with a new bored lock with a brass or antique brass finish.

A new entry door can make a big splash, but only if it complements the style of the house. “The biggest mistake people make is to choose a door that doesn’t match the neighborhood or home,” says Donnie Worley, broker at RE/MAX Real Estate Service in Sanford, N.C. “You won’t recoup the money at resale, and it might look funny. For high-end homes, leaded glass may be appropriate. But in a more moderately priced home, a regular steel door painted in a color that complements the home’s trim will make a bigger impact.” 

Sellers can get their money’s worth with online research before a purchase, says Peter McCluskey, owner of McCluskey Construction, Realty, and Loans in San Francisco. “Identify the type of steel, whether the door has been primed with a rust inhibitor, how many coats of finish paint have been added, and whether it’s insulated and if so with what insulation rating,” McCluskey says. “An alternative to finish paint is powder coating. It’s more like glue than paint and generally better than nonpowder coating.” 

Finally, thoroughly inspect the door before buying and installing it. “Steel doors can dent easily, and you can’t fix dents,” says Taylor Joe Goldsmith, vice president of marketing and sales at Joe Goldsmith Construction Inc. in Lakeland, Fla. “Make sure the door is in good condition before you purchase it.” 

Replacement projects have always performed better in resale value than other types of remodeling projects, partly because they’re among the least expensive.

PROJECT 2: Garage Door Replacement

Cost $1,291

Resale value $1,083

Cost recouped 83.9%

National averages

What this project entails: Remove and dispose of the existing 16-by-7-foot garage door and tracks. Install a new 4-section garage door on new galvanized steel tracks; reuse the existing motorized opener. The new door is uninsulated, single-layer, embossed steel with two coats of baked-on paint, galvanized steel hinges, and nylon rollers. 10-year limited warranty. 

Home owners should be careful when choosing a garage door because it’s easy to buy a more expensive product than what’s necessary. In many cases, a basic door will do the job, McCluskey says. “There are a few standard garage doors priced around $600, and installed they might be twice that,” he says. “If you want something that looks like a carriage door, expect to pay three times as much.” 

Sellers should also consider how potential buyers might use the garage. A selling point for garage tinkerers might be windows or upgraded insulation. “Lots of people don’t even park vehicles in their garage but instead use it as their workshop,” says Goldsmith. “In the winter, an insulated door will knock the edge off of the cold and will also keep the garage cool in the summer.” 

Windows allow in natural light. “That’s pretty important and often overlooked,” McCluskey says. “Windows aren’t typically a large extra expense, costing about $100 extra. But they make an enormous difference in the usability of your garage. If it’s dark inside, you can’t do anything without opening the door.” 

Another potential selling point is a belt-driven garage door opener, which costs about $100 more than a chain-driven model. “A chain drive is really noisy,” McCluskey says. “With a belt, you can hardly hear the door move.”

PROJECT 3: Siding Replacement

(Fiber Cement)

Cost $13,382

Resale value $10,707

Cost recouped 80.0%

National averages 

What this project entails: Replace 1,250 square feet of existing siding with new fiber-cement siding, factory primed and factory painted. Include all 4/4 (1-inch) and 5/4 (1.25-inch) trim using either fiber-cement boards or cellular PVC. 

“Siding materials can vary widely, so home owners should be sure they’re getting actual cement siding, rather than pressboard or other composite materials,” says McCluskey. “Look on the Internet at the specifications on the various cement siding products. There are no standard materials, so you have to know what materials are being used so you can compare apples to apples.” 

Home owners should also ask siding contractors how much of an overlap, called the “lap,” there will be on each board. “This is one of these ‘duh’ things,” says Goldsmith. “I live in a historic district, and I’ve seen homes in which the lap is three inches, which gives siding a wood look, instead of the maximum lap of six inches. Those home owners are wasting materials. Ask how big a lap contractors will use and whether it would save on materials and lower the cost to increase the lap.” 

Finally, home owners should consider prepainted siding, which they can then tout to potential buyers. “That can save home owners money,” says McCluskey. “They won’t have to have the siding repainted every few years.”

PROJECT 4: Kitchen Remodel  (Minor)

Cost $21,695

Resale value $15,790

Cost recouped 72.8%

National averages 

What this project entails:  In a functional but dated 200-square-foot kitchen with 30 linear feet of cabinetry and countertops, leave cabinet boxes in place but replace the fronts with new raised-panel wood doors and drawers, including new hardware. Replace the wall oven and cooktop with new energy-efficient models. Replace laminate countertops; install a mid-priced sink and faucet. Repaint the trim, add wall covering, and remove and replace resilient flooring. 

“Too often, home owners overimprove their kitchen,” says Adam Bosworth, a sales associate at Peggy Parker Real Estate LLC in Norwich, N.Y. “That’s not cost-effective unless they’ll stay in the house a long time.” 

To save a good chunk of money on a kitchen remodel, keep your existing electrical wiring and plumbing in place, Bosworth says. 

Another idea: Considering painting your cabinets instead of buying new ones, advises Jude Herr, broker-owner of Boulder Area Realty in Boulder, Colo. And while many home owners opt for laminate flooring that resembles wood, Herr says ceramic tile is a smarter option. “With a laminate, you may get a negative reaction,” she says. “You can buy nice ceramic tile for the same amount of money as wood laminates.” 

However, do consider a laminate countertop. “The most cost-effective way to give a kitchen a better look is with a laminate,” says Jeff Carbone, a general contractor and sales associate at Coldwell Banker Premiere, REALTORS®, in Southington, Conn. “The selections today are very impressive, with many mimicking quite well the look of marble, granite, or other natural stones.” 

Finally, to save money, do some of the work yourself. For example, tell your contractor that you’ll remove the cabinets, advises Bosworth. “Ask your contractor to let you know when he’s done with the drywall,” adds Herr. “Then do the painting yourself before cabinets are installed, patching nail holes or scratch marks later. That will save you the cost of painting, and it’s easier than painting afterward, when you have to work around the cabinets.”

The minor kitchen remodel may carry a high price tag, but it’s a relatively inexpensive face-lift to what many buyers consider the most important room in the home.

PROJECT 5: Deck Addition (Wood)

Cost $10,973

Resale value $7,986

Cost recouped 72.8%

National averages 

What this project entails:  Add a 16-by-20-foot deck using pressure-treated joists supported by 4-by-4-foot posts anchored to concrete piers. Install pressure-treated deck boards in a simple linear pattern. Include a built-in bench and planter of the same decking material. Include stairs, assuming three steps to grade. Provide a complete railing system using pressure-treated wood posts, railings, and balusters.

A new wood deck can look stunning, but if not done correctly it could turn into a drawback to buyers. Home owners should also be sure a new deck isn’t too big or small. “Home owners can add an 8-by-8-foot wood deck, but it’s so small the space seems useless,” says Bosworth. “Or they can put on a deck that spans the length of the home. That’s great for entertaining, but they’ll never recoup the cost.” 

Bosworth also recommends that sellers who need to save money choose a contractor who’ll let them do some of the work. “Have the footings poured by a professional and maybe the frame put together by one, too,” he says. “But anybody who knows how to use a screw gun can put in the floorboards and railings.” 

Adding a natural stain can be a final selling point. “I hear constant complaints from home owners about having to stain the deck every year,” says Bosworth. “Colored stains like darker browns and reds wear very unevenly. Natural stains wear more evenly.” 

Before any work begins on the new deck, make sure that permits are in place. “Home owners should check with their local code enforcement department,” Worley says. “People who work [in the department] will often give them free advice to help owners avoid mistakes. They may even provide copies of building codes so home owners can be sure railings are the correct height and vertical slats aren’t too far apart or close together, potentially dangerous for children or pets.” 

This project is considered essential rather than discretionary in many markets, particularly in neighborhoods where every home has an outdoor living space.  

Since it was added to the survey in 2005, fiber-cement siding replacement has ranked first among projects costing $5,000 or more.

This project is a new addition for the 2010–11 report, in recognition that curb appeal continues to play a strong role in a home’s resale value.

Construction cost estimates are generated by HomeTech Information Systems (http://www.hometechonline.com) of Bethesda, Md., which takes into account construction commodity data and labor cost information from a nationwide network of remodeling contractors. The company prepares a detailed construction estimate for each project and then adjusts this baseline cost for each city to account for regional pricing variations. However, project costs are based on estimates for hypothetical projects, with no reliable way to accommodate local and short-term fluctuations in supply and demand. Resale value data for each project are aggregated from estimates provided by REALTORS®. E-mail surveys were sent to some 150,000 appraisers, sales agents, and brokers in the summer of 2010, and more than 3,000 participated. Respondents were instructed not to make judgments about the motivation of the home owner in  the decision to undertake the remodeling project or to sell the house.

Fireplace prep, wood and bug (yuck) tips from Pillar to Post Inspection Services and the Horticulture Dept. of  the University of Nebraska-Lincoln

The typical homeowner of 2010

Home buyers today have affirmed a long-term view of home ownership, the typical seller is experiencing positive returns and the vast majority of home owners see their property as a good investment, according to the latest consumer survey of home buyers and sellers.

The 2010 NAR Profile of Home Buyers and Sellers is the latest in a series of large national NAR surveys evaluating demographics, preferences, marketing and experiences of recent home buyers and sellers.

Although typical sellers had been in their previous home for eight years, up from seven years in the 2009 study, first-time buyers plan to stay for 10 years and repeat buyers plan to hold their property for 15 years.

Here are some highlights:

• The typical seller who purchased a home eight years ago experienced a median equity gain of $33,000, a 24% increase, while sellers who were in their homes for 11 to15 years saw a median gain of 40%.
• With #1 reason to buy a home being a good investment, the next biggest reasons for buying, identified by all home buyers, was a desire for a larger home, 9 percent; a change in family situation and the home buyer tax credit, 8%; a job-related move, 7%; and the affordability of homes, 6%. Twelve other categories were 5% or less.
• The number of first-time home buyers rose to a record high 50% of all home sales from 47% in the 2009 study, building on success of the home buyer tax credit which began in 2009.
• The profile shows the median age of first-time buyers was 30 and the median income was $59,900. The typical first-time buyer purchased a 1,540 square foot home costing $152,000, with 93% using the first-time buyer tax credit.
• 56% of entry level buyers financed their purchase with an FHA loan, while another 7% used the VA loan program. 42% said financing their first home was more difficult than expected and 9% had been rejected by a lender.
• 58% of all buyers are married couples, 20% are single women, 12% single men, 8% unmarried couples and 1% other.
• Buyers searched a median of 12 weeks and viewed 12 homes.
• The typical repeat buyer was 49 years old, earned $87,000 and purchased a 2,000 square foot home costing $215,000.
• The median age of home sellers was 49 and their income was $90,000. Sellers moved a median distance of 18 miles and their home was on the market for 8 weeks, down from 10 weeks in the 2009 survey. Half traded up in size, 28% bought a comparably sized home and 21% traded down.
• 64% of sellers chose their agent based on a referral or had used the same agent in the past. Reputation was the most important factor in choosing an agent, cited by 35% of respondents, followed by trustworthiness at 23%. 84% of sellers are likely to use the same agent again or recommend to others.
• Home buyers thought the most important services agents offer are helping find the right house, negotiating sales terms and price. Buyers also most commonly choose an agent based on a referral from a friend, neighbor or relative, with trustworthiness and reputation being the most important factors.
• Buyers use a wide variety of resources in searching for a home: 89% surf the Internet, 88% use real estate agents, 57% yard signs, 45 percent attend open houses and 36% look at print or newspaper ads. Although buyers also use other resources, they generally start the search process online and then contact an agent.
• Local metropolitan MLS websites were the most popular Internet resource, used by 59% of buyers; followed by Realtor.com, 45%; real estate company sites, 43%; real estate agent websites, 42%; other websites with real estate listings, 41%; and for-sale-by-owner sites, 15 percent; other categories were smaller.
• 77% of all buyers purchased a detached single-family home, 9% a condo, 8% a townhouse or rowhouse, and 6% some other kind of housing.
• Not surprisingly, for-sale-by-owner transactions reached a record low, accounting for 9% of sales in the 2010 study, down from 11% in 2009.
• The share of homes sold without professional representation has trended down since reaching a cyclical peak of 18% in 1997.

Source: NAR

Home values continue to rise which is good news for central Ohio. The average sale price for the first nine months of the year is $161,204 up 7.4 percent from the beginning of 2010 according to the Columbus Board of REALTORS®. 

There were fewer homes listed for sale last month than is customary for September. Over the last five years, there was an average of 3,710 homes added to the market during the month of September. However, last month only 2,997 residential homes were added to the already elevated inventory in central Ohio. 

Although slightly lower than August, the total residential listings in September (16,728) was still higher than it’s been since August of 2008 when the inventory level rose to 16,975. 

“Inventory levels had come down over the last year and a half – which is what we were working towards,” said Sue Lusk-Gleich, President of the Columbus Board of REALTORS®. “When inventory levels are too high, the increased competition forces some homeowners to sell at prices that are too low which in turn often affects the values of other neighboring homes.” 

“In order to re-balance the market, we either need the inventory to decrease or the number of buyers to increase. And since the tax credit incentives brought many buyers into the market earlier than we would have seen otherwise, we have a smaller pool of potential home buyers to absorb the inventory now.” 

Home sales were down 28.4 percent in September and the number of homes that went into contract was also down almost 25 percent which doesn’t bode went for October home sales. 

“When comparing sales figures to the previous year, we need to remember that home sales have been elevated since April of 2008 due to the tax credits,” adds Lusk-Gleich. “Even so, sales are still up four percent year to date.” 

The Columbus Board of REALTORS® Multiple Listing Service (MLS) serves all of Franklin, Delaware, Fayette, Madison, Morrow, Pickaway and Union Counties and parts of Champagne, Clark, Hocking, Licking, Fairfield, Knox,Logan, Marion, and Ross Counties.

taken from Columbus  Board of Realtors website

Home sales and prices up in August

Interest rates still low and the selection of homes plentiful 

August home sales in central Ohio were higher than the previous month and the average sale price of a home sold continues to rise. There were 1,605 homes sold in August which is 8.2 percent more homes sold than during the month of July. Home sales during the first eight months of the year are now 9.2 percent higher than the same period in 2009. 

“We saw a lull in housing activity after the tax credit expired which was not surprising given the frenzy of activity attributed to the generous tax credits for both first time and repeat buyers earlier this year,” said Sue Lusk-Gleich, President of the Columbus Board of REALTORS®. “This upswing in sales is a positive sign that our central Ohio housing market continues to strengthen.” 

The average sale price of a home has been inching back up this year from $145,993 in January to $169,959 in August. The average sale price year to date (January through August) is $161,645, which is 2.2 percent higher than one year ago. 

There were 3,700 homes listed for sale last month bringing the total number of homes for sale in central Ohio to nearly 17,000 which is 16.5 percent more homes than were on the market at the end of last summer. 

“With interest rates still so low and the selection of homes for sale so plentiful, any one who has an interest in buying a home should take a look at what’s available right now,” adds Lusk-Gleich.

taken from Columbus Board of Realtors website

We tend to like, and digest, ideas or arguments in list form. The following from the Wall Street Journal is easily digestible.

The Wall Street Journal, By Brett Arends

September 16, 2010

Enough with the doom and gloom about homeownership.

Sure, maybe there’s more pain to come in the housing market. But when Time magazine starts running covers that declare “Owning a home may no longer make economic sense,” it’s time to say: Enough is enough. This is what “capitulation” looks like. Everyone has given up.

After all, at the peak of the bubble five years ago, Time had a different take. “Home Sweet Home,” declared its cover then, as it celebrated the boom and asked: “Will your house make your rich?”

But it’s not enough just to be contrarian. So here are 10 reasons why it’s good to buy a home.

1. You can get a good deal. Especially if you play hardball. This is a buyer’s market. Most of the other buyers have now vanished, as the tax credits on purchases have just expired. We’re four to five years into the biggest housing bust in modern history. And prices have come down a long way– about 30% from their peak, according to Standard & Poor’s Case-Shiller Index, which tracks home prices in 20 big cities. Yes, it’s mixed. New York is only down 20%. Arizona has halved. Will prices fall further? Sure, they could. You’ll never catch the bottom. It doesn’t really matter so much in the long haul.

Where is fair value? Fund manager Jeremy Grantham at GMO, who predicted the bust with remarkable accuracy, said two years ago that home prices needed to fall another 17% to reach fair value in relation to household incomes. Case-Shiller since then: Down 18%.

2. Mortgages are cheap. You can get a 30-year loan for around 4.3%. What’s not to like? These are the lowest rates on record. As recently as two years ago they were about 6.3%. That drop slashes your monthly repayment by a fifth. If inflation picks up, you won’t see these mortgage rates again in your lifetime. And if we get deflation, and rates fall further, you can refi.

3. You’ll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes. And you’ll get a tax break on capital gains–if any–when you sell. Sure, you’ll need to do your math. You’ll only get the income tax break if you itemize your deductions, and many people may be better off taking the standard deduction instead. The breaks are more valuable the more you earn, and the bigger your mortgage. But many people will find that these tax breaks mean owning costs them less, often a lot less, than renting.

4. It’ll be yours. You can have the kitchen and bathrooms you want. You can move the walls, build an extension–zoning permitted–or paint everything bright orange. Few landlords are so indulgent; for renters, these types of changes are often impossible. You’ll feel better about your own place if you own it than if you rent. Many years ago, when I was working for a political campaign in England, I toured a working-class northern town. Mrs. Thatcher had just begun selling off public housing to the tenants. “You can tell the ones that have been bought,” said my local guide. “They’ve painted the front door. It’s the first thing people do when they buy.” It was a small sign that said something big.

5. You’ll get a better home. In many parts of the country it can be really hard to find a good rental. All the best places are sold as condos. Money talks. Once again, this is a case by case issue: In Miami right now there are so many vacant luxury condos that owners will rent them out for a fraction of the cost of owning. But few places are so favored. Generally speaking, if you want the best home in the best neighborhood, you’re better off buying.

6. It offers some inflation protection. No, it’s not perfect. But studies by Professor Karl “Chip” Case (of Case-Shiller), and others, suggest that over the long-term housing has tended to beat inflation by a couple of percentage points a year. That’s valuable inflation insurance, especially if you’re young and raising a family and thinking about the next 30 or 40 years. In the recent past, inflation-protected government bonds, or TIPS, offered an easier form of inflation insurance. But yields there have plummeted of late. That also makes homeownership look a little better by contrast.

7. It’s risk capital. No, your home isn’t the stock market and you shouldn’t view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up again, too. One lesson from the last few years is that stocks are incredibly hard for most normal people to own in large quantities–for practical as well as psychological reasons. Equity in a home is another way of linking part of your portfolio to the long-term growth of the economy–if it happens–and still managing to sleep at night.

8. It’s forced savings. If you can rent an apartment for $2,000 month instead of buying one for $2,400 a month, renting may make sense. But will you save that $400 for your future? A lot of people won’t. Most, I dare say. Once again, you have to do your math, but the part of your mortgage payment that goes to principal repayment isn’t a cost. You’re just paying yourself by building equity. As a forced monthly saving, it’s a good discipline.

9. There is a lot to choose from. There is a glut of homes in most of the country. The National Association of Realtors puts the current inventory at around 4 million homes. That’s below last year’s peak, but well above typical levels, and enough for about a year’s worth of sales. More keeping coming onto the market, too, as the banks slowly unload their inventory of unsold properties. That means great choice, as well as great prices.

10. Sooner or later, the market will clear. Demand and supply will meet. The population is forecast to grow by more than 100 million people over the next 40 years. That means maybe 40 million new households looking for homes. Meanwhile, this housing glut will work itself out. Many of the homes will be bought. But many more will simply be destroyed–either deliberately, or by inaction. This is already happening. Even two years ago, when I toured the housing slumpin western Florida, I saw bankrupt condo developments that were fast becoming derelict. And, finally, a lot of the “glut” simply won’t matter: It’s concentrated in a few areas, like Florida and Nevada. Unless you live there, the glut won’t have any long-term impact on housing supply in your town.

We all know about the great interest rates. But here is another underliner. Had to do it.

Today’s mortgage interest rates may never be this good again

Today’s mortgage rates are at historic lows but history suggests they won’t stay there. Because home buyers may never see these rates again, they need to BUY NOW, says Marc Roth, president of Home Warranty of America.

In an article written for Business Week, Roth states, “If you want to buy a house, now is the time, and if you don’t act soon, you will regret it. Here’s why: historically low interest rates.”

According to Mortgage-X.com, the average mortgage interest rate in 1970 hovered around 7.25 percent. Shortly thereafter, it began crawling upward, landing near 10 percent in late 1973 and settling back to nine percent between 1974 and 1976. Although high by today’s standards, people in 1976 would have been happy with nine percent.

From 1977 to 1981, the 30-year fixed rate was near 18 percent. Rates jockeyed for several years, hitting 11 percent in the late 1980s before slowly declining in the 1990s.

Every quarter of a percent counts! On a $200,000 loan with a 10 percent interest rate, the monthly payment would be $1,755. With a 4.5 percent loan, the payment would be $1,013.

Take advantage of today’s 4.5 percent interest rates or it may be another 20 years before rates are this favorable again. Combine that with the reasonable home prices we are seeing today, and this era exemplifies what we mean by a “buyer’s market.”

RISMEDIA, June 29, 2010—(MCT)—Home shoppers who missed the April 30 deadline for a housing tax credit might have the last laugh. For a variety of reasons, they could end up saving more than the $8,000 they could have received from the tax refund.

In some neighborhoods and price ranges, sellers are dropping their prices because buyers are harder to find now that the credit has expired. Builders and real estate companies began offering promotions after the tax credit ended that, in many cases, are worth more than the credit.

Interest rates have dropped enough since the credit deadline that, over the life of a loan, a homeowner could easily save more than the value of the credit. “I think some folks possibly could have benefited from waiting until after the tax credit,” said Joe Jackson, a real estate agent with Keller Williams Capital Partners. “It would depend on the price point they were buying in and the market they were looking in.”

Home sales leapt in March and April during the waning weeks of the credit, especially for homes priced at less than $200,000, which appealed to first-time home buyers. Since the credit expired, home contracts and building permits have tapered off, leaving sellers with fewer buyers and, in some cases, little choice but to cut their price.

According to real estate website Trulia.com, which tracks price reductions, 30% of central Ohio homes for sale on May 1 had reduced their asking price—more than in April or March. Buyers hope they can take advantage.

Karen Kosnikowski learned days after the tax credit ended that she would have to leave her Victorian Village apartment June 30 because her landlord wanted the place. Her initial frustration at missing the tax credit changed when she started seeing price declines. “I would say five or 10 times a day, something comes in, and half of those are price drops. Sometimes, they are down several thousand,” Kosnikowski said. “So places I’ve seen before are starting to drop, or others are coming into my price range.”

A home in the Clintonville neighborhood she has toured twice, for example, dropped in May from $185,000 to $167,900. Another Clintonville home on her radar dropped from $179,900 to $167,000 after the credit expired, while a Downtown condo she visited went from $189,900 to $169,500.

“None of these went anywhere during the tax credit,” said her agent, Terry Penrod of Real Living HER. “So Karen can just wait to see how low they go.”

Kathy Shiflet, an agent in the Dublin-Hilliard office of Coldwell Banker King Thompson, has found the same thing. She represents a buyer looking for a two-story home in Hilliard. After the tax credit expired, one of two homes under consideration dropped from $156,900 to $149,900 while the other dropped from $154,900 to $149,900.

The tax credit might have something to do with it, but Shiflet thinks the season is a greater factor. “There have been reductions in prices, but traditionally, prices start to come down in June anyway,” she said, “because everyone wants to move in time for school.”

Those shopping for new homes are finding a different kind of bargain as some builders roll out incentives to keep traffic moving.

After the credit expired, Dominion Homes and Fischer Homes launched promotions for free finished basements and/or other upgrades. Either deal would be worth well above the $8,000 credit. “We expected a drop in traffic after the tax credit expired, and we saw that a little bit,” said Jon Jasper, who manages the Columbus division of Fischer Homes. “We anticipated that, and we had strategized to offer some incentives to bring people back. That promotion we’re offering with the free basement is huge in this market.”

Other builders are offering free appliances, trade-in programs, rebates and “sweat-equity” discounts that allow a homeowner to drop the price by painting, landscaping or otherwise helping to finish their home.

Mike Marshall, an agent with Buyer’s Resource Realty Services, said he represented one buyer who deliberately passed on the tax credit to wait for a better deal on a new home. “They found a new build that was so much better in price with the discounts that they gave up the tax credit,” Marshall said.

Real estate companies are also getting into the act. To compensate for the vanishing tax credit, Coldwell Banker launched its Buyer Bonus Program that awards up to $8,000 back to buyers from participating sellers.

Finally, interest rates have dropped nearly half a point since the end of April, saving buyers thousands of dollars over the life of a loan. Buyers of a $180,000 home who borrowed $173,700 in mid-April at an interest rate of 5.125% would have paid $377,442 over the next 30 years—$15,000 more than they would pay if they borrowed last week at an interest rate of 4.75%.

“I know it’s not money in your pocket right away,” said Barb Wilson, the head of mortgage lending at Newark-based Park National Bank, “but the value of the interest rate today is really better than the tax credit.”

Some real estate experts see the central Ohio housing market now settling into a normal rhythm in the absence of the stimulus, which so far has cost taxpayers $18.7 billion.

“At the end of the day, we don’t believe the tax stimulus will put us any further ahead than we would have been otherwise,” said Jerry White, executive vice president with Coldwell Banker King Thompson.

Copyright (c) 2010, The Columbus Dispatch, Ohio

Distributed by McClatchy-Tribune Information Services.