We’ve written extensively on the tax credit available for first-time homebuyers (a restriction that may get lifted).
In many private conversations I’ve had, the general consensus has been that this tax credit hasn’t had much impact, that people really don’t care, that first-time home buyers aren’t buying that many homes, even that people are not aware of the credit.
Personally, we have yet to have a potential home buyer say, “The only reason we are buying now because of this tax credit”. (And that’s a good thing, as it is a horrible reason to buy if that’s the only reason you are buying.)
But that doesn’t mean the tax credit is not a factor. Many of our buyers mention it as one of several reasons they are buying; including the tax credit with things like historically low interest rates, low home prices, “good deals”, and the age-old “I’m tired of renting”.
Are people aware of the tax credit? Is there interest in it?
I’ll let the statistics for this blog speak. You tell me. Here are the top 25 search terms people used to find this blog last week.
| Rank | Keyword | Visits |
| 1 | 15000 tax credit first time home buyer | 292 |
| 2 | 15000 tax credit home buyers | 185 |
| 3 | 15 000 tax credit for home buyers | 184 |
| 4 | 15000 tax credit | 169 |
| 5 | phoenix real estate guy | 128 |
| 6 | home buyer tax credit 15000 | 83 |
| 7 | 15000 home buyer tax credit | 80 |
| 8 | 15 000 tax credit | 67 |
| 9 | phoenix real estate | 57 |
| 10 | 15,000 tax credit for home buyers | 49 |
| 11 | first time home buyer tax credit 15000 | 46 |
| 12 | $15,000 tax credit | 39 |
| 13 | 15000 tax credit for home buyers | 37 |
| 14 | 15k tax credit | 37 |
| 15 | first time home buyer tax credit increase 15000 | 31 |
| 16 | the phoenix real estate guy | 31 |
| 17 | 15,000 tax credit | 30 |
| 18 | home buyers tax credit 15000 | 27 |
| 19 | phoenix real estate blog | 27 |
| 20 | firpta | 26 |
| 21 | phoenix fireworks | 24 |
| 22 | border crossing mexico | 21 |
| 23 | home buyer tax credit | 21 |
| 24 | 15 000 tax credit for homebuyers | 20 |
| 25 | 15 000 home buyer tax credit | 19 |
18 of the top 25 search terms used last week were related to the $15,000 home buyer tax credit (a total of 1,416 visits). Granted, these top 25 searches only account for 1,730 of the 12,058 visits here last week, but the point is people are looking for information on the tax credit, and presumably some fraction of those are acting on that information. For how many the tax credit is a major factor in actually deciding to purchase a home is the big question that can’t really be answered.
For the statistically obsessed, there were 8,210 visits here last week from search engines – and 5,096 search terms were used. That’s a testament to the “Long Tail” of search. (And if you care, 7,229 of those 8,210 searches were done on Google – a testament to the fact that Google is taking over the world.)
A total of 2,975 visitors using a search term that included “tax credit” stopped by last week – that would be 24% of the visitors to this site.
Since the tax credits were first discussed back in February of this year 31,168 searchers using 11,637 different terms including the words “tax credit” have visited Phoenix Real Estate Guy.
True, 31,000 people isn’t a lot compared to the general home buying population of the U.S. But this is just one insignificant spot on the vast, world wide even, web. If there are 31,000 people looking for information here, how many more are looking elsewhere?
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{ 33 comments… read them below or add one }
Interesting results. I have been getting a lot of questions on that as well, and I am sure that there is some Google traffic coming in for me on the same road. The credit has been a huge topic of discussion, but I agree that it has not been the ultimate deciding factor with any clients yet.
**Portland Real Estate´s last blog post..Mt. Tabor Park: SE Portland
Interesting post and stats. I would say people are definitely interested and aware of the tax credit. Not sure how anyone could ever effectively measure just how many people buy because of the tax credit. No question there are information seekers and it seems reasonable to assume some are buying because of the credit.
You blew it on one thing though.
“But this is just one insignificant spot on the vast, world wide even, web”
I wouldn’t call this blog an “insignificant spot” on the www.
Jay – Although my numbers aren’t as high as yours, a karge percentage are looking at the home buyer tax credit and taxes in general in Indianapolis – we have huge tax issues here. First time home buyers are out looking at homes, mostly because of the tax credit.
I do wonder about your search for crossing the Mexico border, though – are they searching for the tax credit:)
**Paula Henry – Indianapolis Homes´s last blog post..Indiana Housing Rates Down to 5.5%
Paula – I wrote a post almost 18 months ago about the changes the government put in place for crossing in to and out of Mexico. People still find that post every day. I’ve actually had people call me asking questions about the rules. It’s crazy!
Jay, a search on google for home buyers tax credit will offer up 20 Million hits. It’s a popular item of discussion. Law makers and tax professionals don’t know how it applies correctly and neither do most of us real estate professionals. Most of the consumers (home buyers/tire kickers) I have talked to seem aware (smart people) but not part of the buying plan for them to purchase. It is price, price, price and location of the property that motivates. I did notice your site now comes up in the top ten or google using such a search term. That’s why I think you’re a smart man and will be certain to go far in the RE Business world. And, I am sure that is why so many real estate professionals visit your site for information and discussion on such hot topics. But, don’t make me say the numbers thing – not to you.
Hi Jay,
I am getting a good percentage of my traffic from people looking for information on the home renovation tax credit that the Canadian government is offering. No matter what the tax credit is for or how much it seems, people will be interested in it. We all pay too much in taxes as it is. You are doing your readers and new comers that would never have found this info so easily a service by writing on it.
**Halifax Real Estate´s last blog post..The Parks of West Bedford
The tax credit absolutely has folks moving off the fence here in Central Florida. Not all lenders are moving forward with the advance to help defer some of the closing costs, but the extra cash come tax time has activity levels up for sure.
**Kevin Sandridge´s last blog post..Orlando First-Time Home Buyers: Use the $8000 Tax Credit to Defer Closing Costs
One thing I have noticed as a seller is the level of entitlement has shot through the roof. Everyone expects you to bend over backwards to please them. I have even been betrayed by my own agents who decided (without our permission) to be dual agents. We have spent this entire time trying to appease a First time home buyer with unrealistic expectations. I will also tell you this…the market not only left a lot of homes unsold, but a lot of agents desperate for a sale. I came across your website by typing shitty real estate agents in a Google search (NO OFFENSE TO YOU). By reading your blog, I see that you are respected out there, but all you agents beware, remember this is not used car sales.
Great points Jasuntzu. And I’d have to agree with you about the sense of entitlement. It’s pervasive. A good agent will help educate their client, be they buyer or seller and help them set realistic expectations. But let’s face it, there are some not-so-good agents out there (though there are some brilliant ones too).
The tax credit is a huge incentive for home buyers across the board. I do believe that 15,000 would drastically change things in the short term. However, why is the tax credit even needed? Who wants to buy a home when the credit is gone? Then What?
I read an article that stated in 2008 1 in 5 homes in Arizona were bought by a real estate professional. Geez, the guys selling the homes were driving up the price.
“arizona carpet cleaning” -
I’d *love* to see a link to that article. I think it’s complete crap. First of all, prices were certainly not “driven up” in 2008, prices were basically in free fall in 2008.
A more accurate assessment would probably be 1 in 5 real estate professionals lost their job in 2008.
That’s sweet data, but it would be interesting if you could tell how much of the home-buyer tax credit was realtor and how much was potential buyer. I would guess that you have quite a realtor following.
If that is the case, then your data may be a little skewed.
No?
**ShortSaleBlogger´s last blog post..Patrick.net: It’s still a terrible time to buy
SSB –
Good point. Yes, there are a lot of agents that read this blog.
But, I suspect the vast majority of them either subscribe by RSS and drop in to comment from their feed reader, or they pick up a Tweet or Facebook mention, or they have the blog bookmarked.
In other words, I doubt if many agents — or at least those that read regularly — find posts on the tax credit by doing Google searches.
There is no way to know for sure of course WHO exactly comes in through these Google searches, but it (may be) fairly safe to assume the bulk are people actively looking for info on the credit.
I didn’t think of that…very true.
The Google Key Word Tool shows the May search volume for “first time home buyer tax credit” at 165,000 searches…that’s a lot. There may be a way to show a trend of the search term over time in Google, if you have the time.
https://adwords.google.com/select/KeywordToolExternal
**ShortSaleBlogger´s last blog post..Patrick.net: It’s still a terrible time to buy
I’m more interested in the keyword “border crossing mexico” I may decide to head that way given that I heard that the cap & trade bill has a provision that you will not be able to sell your home without an energy audit first.
**Kevin Curtis´s last blog post..6141 15th Avenue S , Minneapolis, MN
Though there are plenty of factors that comes into a home buyers’ decision, the tax credit is definitely one of them. Just as the searches show people are curious about the tax credit and want to know more. The tax credit can be the extra nudge in a home buyer’s decision.
Southlake TX Homes
Those are some revealing statistics. It goes to show how many people really are interested in the tax credit and that it is in fact a factor for home buyers.
Prescott Real Estate
I agree that it would be horrible if a first time buyer based their choice solely on the tax credit. Though it’s a nice incentive for many buyers, I wonder how much impact the tax credit really has.
McKinney Homes & Real Estate
People do love a good discount. And $8,000 is nothing to scoff at. This was one policy that was well timed and effective. People complain about government intervention, but stopping the slide of real estate prices was and is critical to economic recovery. These $8,000 credits will ultimately save thousands more in reduced property taxes and general heartache for U.S. citizens. I’m all for extending the program past November 30.
I think your statistics do speak for themselves. According to Google search stats there are quite a number of searches for the terms surrounding tax credits. It makes sense in a down economy to look for ways to leverage your costs and ease the burden. The tax credit can help with this endeavor. Hopefully the search volume will decrease on this topic in lieu of a more favorable market turn around. Time will tell.
Thanks, nice post. I like to see real data used like this.
**John Hunter´s last blog post..Another 450,000 Jobs Lost in June
I’d say the home buyer tax credit is making an impact with numbers like this. Keep it coming.
**Brad´s last blog post..Average Price Per Square Foot of Bakersfield, CA homes for sale
… but “border crossing Mexico” is WAY more entertaining than a silly tax credit. J/K.
Home Buyers are very excited about this tax credit and it is WELL worth writing about.
I just found this blog on Google by searching 15,000 tax credit home buyers July. I put July because I was tired of wading through the ones from Feb. I am desperate for the Gov. to say yes or no to something on this because activity here (Oregon City) has stopped since they announced a retry for the credit. By the way, just before I also had an offer 50,000 below my asking price (after lowering our price 75,000) by a 1st timer. His agent called mine stupid several times for not countering (because we wanted to ignore them) and made her feel as small as possible for doing what we told her to do. They did come back w/ a better offer (funny, since that was ALL they could afford before) which we did counter. Then they countered. We would have worked with them more if their agent wasn’t so very insulting to my very nice agent. They really wanted to buy this home and we really wanted to sell, but their agents attitude was so bad we didn’t want to deal w/ him anymore.
The RE agent drop in income story has other facets.Agents incomes are way down. The figures calculated are probably directionally correct overall. What makes things worse for the agents is that they're not doing 54% less work, or incurring 54% less out of pocket costs. Many pay for system access and certain RE related services out of pocket. With income reduced but expenses holding steady, the reduction in their net income is more pronounced. Many of these agents are also spending significant amounts of time and energy working on short sales. Few of these transactions end up closing and yielding commission $ as many banks are dragging their feet on dealing with problems. The only people who seem to have it worse are the spec builders. Many are being boiled alive as the problems they put off in 2008 by renting out unsold inventory are now snowballing into massive losses.
In Baltimore, we have not had alot of people motivated to buy based on the Federal Tax Credit. Buyers are more focused on getting a good deal or making sure that they will not be a forclosure statistic 12 months down the road. The intent of the government was to stimulate the housing market through incentives, which obviously has had a very minimal impact.
The tax credit for first time buyers is just a bonus for those first time buyers that were already planing on buying a home. Maybe a few of those whom were in appts and thinking about moving, but that's it. In my opinion!
I've read this tax credit ends November 30th. But does that mean the loan needs to close by then or be submitted or approved by that date?
The home sale must be CLOSED by Nov 30. All of it, the whole shooting match. In other words, all of the transfer of ownership to the new buyer must be complete, and recorded at the appropriate government agency. ie: the buyer must be the legal owner of the home by Nov 30.
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