If you missed out on housing credit, don't fear
San Francisco Chronicle
By Kathleen Pender
... If you missed out on the $8,000 federal tax credit for first-time home buyers, which is set to expire after Nov. 30, don't despair. One of two things will probably happen: Congress will extend the credit into next year or, if not, home prices will fall as demand falls off, perhaps by as much as $8,000.
Economic theory says that "letting the credit expire will leave house prices to fall somewhere between nothing and $8,000," depending on how sellers respond to the drop in demand, says Richard Green, a real estate professor at the University of Southern California.
If a drop in demand is matched by a reduction in the supply of homes, the price decline might be close to zero. If the number of homes on the market remains unchanged, the drop could be closer to $8,000. "Of course markets don't always respond the way economics say they should," Green warns...