This time last year, during last fall's frenzied market, buyers were competing over a limited number of homes for sale. This was driven in part by the availability of the federal tax credit for first-time buyers. Any house that was in decent shape in Berkeley, for example, especially in the flats, had multiple offers and went well above asking. I had one such listing which received 19 offers, some as high as 15% over asking!

While this was great if you were selling, it was very frustrating if you were a buyer, while you went from property to property, overbidding but still being outbid by someone else. Well things have changed a bit now, and the shoe is on the other foot. We have entered a new buyers market.

So what changed? Well the extension of that tax credit ended April 30, and as we all know from news reports, demand dropped by about 25%. The tax credits served to bring forward a lot of purchases, and once it expired, there was the inevitable drop off in demand. At the same time, the economic stimulus that helped gin up the economy in 2009 started to flag, and of course there were the problems in Greece, the stock market, and the BP oil spill in the Gulf of Mexico.

Over the summer, sellers began to lower their prices, and we've now got plenty of homes on the market at excellent prices for buyers. Coupled with interest rates at even lower levels in the upper 4% range, and sellers willing to contribute cash to closing costs in many cases, buyers have a tremendous opportunity to buy.

If you are thinking about purchasing a home, now is a great time. Let me know if you're in the market, and I will help you find that dream home!