I am going to go out on a limb and predict a surge in housing starts that will last untill June 1st of this year.  Look forward to three months of data that bears this out.  Why will this happen now?  The $8,000 first-time home-buyers credit is a big reason why.

Home-builders have stopped starting new homes since mid October and the levels of inventory is relatively low.  If you sign a contract for a new home today, it will take 6 months for home to be completed and for you to take title.  If you are a first time home-buyer, you must take title by December 1, 2009 or you don’t get the $8,000 tax credit.  A very strong incentive.  That means the house must be complete, the c/o must have been issued by the town, etc.  Work backwards from December 1 and you will realize that you must break ground by June 1st to accomplish this.

I am working with some new home buyers and they are asking contractor to accept a $8,000 penalty for late delivery.  We have not signed anything up like that yet, but it’s coming.

Take a look at all of the homes available as foreclosure and short sales on my website.  Click HERE!