Fannie Mae announced Thursday that it would pay up to 3.5% of the home price to any buyer purchasing a Fannie Mae-owned HomePath® property towards closing costs or new appliances. The offer is good until May 1, 2010. To see what homes are available in your area you can visit www.homepath.com.

This all but strengthens my belief that the housing market is not out of the woods yet. When Fannie Mae has to start employing marketing strategies like this to entice buyers to their properties it must be bad. So let’s see…… 10% tax credit plus 3.5% Fannie Mae credit. That’s a 13.5% sale on real estate which is already on the discount shelf down 10% from three years ago!

Don’t be fooled by the reported 1.5% price increase from a year ago. 1.5% is way to modest once factoring in all the artificial stimulus. Sooner or later we’ll need to find a market price based on reality.