Prices, Tax Credit Prompt First-Time Homebuyers Low prices, low interest rates and the $8,000 tax credit have all encouraged more first-time home purchases. A survey by the National Association of Realtors shows that 47 percent of those who bought a house last year were jumping into the market for the first time.
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Prices, Tax Credit Prompt First-Time Homebuyers

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Prices, Tax Credit Prompt First-Time Homebuyers

Prices, Tax Credit Prompt First-Time Homebuyers

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NPR's Jeff Brady met two of them on a tour of one Denver neighborhood.

JEFF BRADY: Brian Chalmers is just back from one of the most important meetings of his life.


M: Hi, how are you?

BRADY: Hi, I'm Jeff.

M: Jeff, Brian.

BRADY: He just signed the closing papers on a 1950s, single-level brick ranch in Denver's North Park Hill neighborhood.

M: Welcome to Brian's new house.

BRADY: That's his real estate agent, Ann Connelly. Getting to this point was not easy. Chalmers earns about $25,000 a year and saved up that much for a down payment.

M: It's been a five-year struggle, living in very inexpensive apartments, cooking rice every day. I've gone without a cell phone for five years.

BRADY: His new house is in pretty rough shape but at $125,000, he can finally afford to make the jump into homeownership.

M: There was a time back in 2004, 2005 when people were purchasing this same kind of home for, you know, the high 100s, low 200s.

BRADY: Ann Connelly says Chalmers got this house under a short-sale agreement. The lenders accepted about $75,000 less for the property than they'd loaned on it to the previous owner. There are other examples of good deals like this in the neighborhood, too.


BRADY: Just a few blocks away, Courtney Gross and Rebecca Wolff are preparing to spend a first Christmas in their new house.

M: Hello.

BRADY: Hi. Are you Courtney?

M: Jeff? Yeah.

BRADY: I'm Jeff.

M: Nice to meet you. Come on in.

BRADY: They're in their late 20s, and both are social workers. They paid just over $182,000 for the house last spring. That's $28,000 less than it sold for in 2004. And Wolff says that was before the house was completely remodeled, from the basement to a new roof.

M: Because the market dropped, everything kind of went under. We were able to get a house that, you know, a few years ago would've - we wouldn't have been able to afford.

BRADY: There was just one thing missing, says Gross: The windows needed updating. That's where the $8,000 federal tax credit for first-time buyers came in handy.

M: So then we turned around and used that tax credit to put in new windows, but then we also get a tax credit on new windows.

BRADY: Their real estate agent, Vicki Porter, says a few years back, foreclosures really pushed down prices in neighborhoods like this. Now, she says, lenders are more interested in working out short-sale deals before a foreclosure is under way.

M: So, there's still some great opportunities for any buyer, but especially first-time homebuyers with the tax credit.

BRADY: Back over at Brian Chalmers house, he can't wait to begin work.

M: Ripping up these carpets and throwing them in the trash is the top of the list. They're filthy. They're orange.

BRADY: Even his agent has the remodeling bug. She wants to see the oak floors under that carpet.

M: Hey, what's under this blue carpet here in the hall? Did you look...


BRADY: Chalmers reaches down, grabs a corner and rips.


M: You - start the demo right now.

BRADY: Jeff Brady, NPR News, Denver.

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