The government's home buyer tax credit program, which was extended last fall, is scheduled to end soon. Homeowners seeking to take advantage of the tax credit would need to sign a sales contract by the end of April, and close by July 1, in order to see the refund. The program, which provides for up to $8,000 in tax credits for home buyers meeting the eligibility qualifications, was established to help increase home purchases. Initially a great success, the impact on the real estate market following the fall extension was far less, with home sales declining yet again.

The general logic among most people is that it is always better to own than to rent. That is oftentimes the case; however there are circumstances where that is not necessarily true. As the linked article above suggests, there are many factors that a consumer should consider before deciding if attempting to take advantage of the home buyer tax credit before it expires is the right thing to do. Aside from the obvious issue of whether home values in your area are expected to increase or decrease in the near future, it is also necessary to consider other factors to prevent the catastrophe many individuals and families experienced during the previous housing boom.

The home buyer tax credit is a helpful program, but only if you are already in a position to purchase a home. The $8,000 credit is not a significant an amount when you apply it to a purchase that is likely to be in the hundreds of thousands of dollars, which will be your responsibility for year or decades. If you weren't already considering purchasing a home, then you definitely don't need to start thinking about it now just because the tax credit is about to expire.

We will continue to be in an economically uncertain period for some time. Although the president and others have declared that the recession is over, there could be another economic downturn in the next year or two. Now is not the time to make big purchases unless they are virtually a sure bet. Even if you can afford it, it would be unwise to rush into buying a home at this time unless you live in an area where the value of homes is expected to increase in the next couple of years -- and you have the financial reserves to hold onto a home in case that does not happen.

Homeownership can be a great investment if done properly. Done improperly, it can leave you in a financial hole that may take you years to dig yourself out of. It is better to rent than to find yourself "upside-down" in a house with no way out.