Tax credits helped Triangle home sales spike in 2nd quarter

Home sales in the Triangle surged in the second quarter as the market continued to receive a boost from the government tax credits for first-time and repeat buyers.

Sales were up 24 percent in the second quarter when compared to the same period in 2009, Triangle Multiple Listing Services data show.

But there continue to be worrisome signs that activity in the market has slowed considerably with the expiration of the tax credits.

To be eligible for the tax credits buyers had to put a home under contract by April 30. It can take 30 days or longer to close on a house after putting it under contract.

The number of showings in the second quarter, which includes two months of data after the April 30 deadline, dropped 15 percent from the same quarter a year earlier. Pending sales were down 3 percent.

Real estate professionals are watching nervously to see how severe the drop off in sales will be once the effect of the tax credits is no longer being felt.

The end of the tax credits has also caused new housing starts to fall across the country.

They were down 10 percent in May, the biggest decline since March 2009, the U.S. Commerce Department reported.