When the government launched the First-Time Homebuyer Tax Credit, the real estate investing world started to wait and ask questions. Will the tax credit indeed help minimize the effects of the housing bubble burst? Will it encourage people to purchase homes for the first time? Will the measure help real estate investors in any way at all? Well recent news indicated that the program, after all, may be effective in terms of helping raise home sales.

According to the report, demand for home loans surged by more than 10% in the last week of April. The reason cited for the increase was the “home rush” by buyers who are scrambling to avail of the tax credit program. Home buyers reportedly wanted to beat the buzzer as the measure that entitles buyers up to $8,000 worth of tax credits expired on April 30.

Industry experts said another reason is that home buyers are now doing better. “All the data that we’ve seen recently point to the fact that consumers are in a better place today than they were six months ago, and because of that they will likely be more active in the housing market,” Credit Union National Association senior economist Mike Schenk said. The real estate investing circle is abuzz with this news.

It could be that home loan applications, and subsequently home purchases, will increase despite the expiration of the $8,000 tax credit. Some market experts, however, argue that homes sales will fall after the deadline. Well, the real estate investing world is waiting cautiously for now.

Will home sales drop now that the tax credit has expired? Let us know what you think. Simply log in or leave your email below to join the discussion.