Neither the new $7,500 first-time buyer tax credit nor the closing window on seller-funded down payment assistance have had much effect on traffic at new-home builder communities in the weeks since the housing recovery bill was signed into law, according to an August neighborhood survey by FTN Midwest Securities. The results suggest that the legislation's stimulative effect on housing may be less of a shot in the arm and more of a time-release formula.

Of the sales representatives surveyed, nearly half said traffic levels remained primarily unchanged from last month. Thirty percent reported increased traffic at their communities since July while 23% saw traffic levels decline.

Roughly eight out of 10 sales reps surveyed understood both the tax credit and changes in down payment assistance, but few were actively marketing these aspects of the new law to home shoppers. Twenty-two percent of respondents sent mailers explaining the new provisions to potential buyers; 16% indicated they sent information out in an e-mail blast to prospects. About half of the survey respondents said they had some sort of information sheet available in their sales centers.

However, more builders may soon begin promoting the legislation, as well as local home building associations. Pulte Homes and Beazer Homes, for example, already initiated marketing campaigns around the tax credit. Pulte launched a national "Jump-Start" promotion, where every buyer who purchases a Pulte home from Aug. 5 through Sept. 15 will receive at least $7,500 in savings to match the government's tax credit. Yesterday, Beazer produced a free informational Webinar for prospective home buyers that focuses on the tax credit.

These types of tactics intend to increase buyer awareness of the law and create urgency in the marketplace, but buyers still appear reluctant. Of the surveyed sales reps who had marketed the new law's provisos, 44% reported little interest from potential buyers. Thirty-nine percent found their efforts generated favorable buyer interest, while 17% said they received mixed responses from prospects.

This stands in stark contrast to reports from the NAHB that its consumer-targeted Web site has generated a tremendous amount of interest. In the site's first five days, the association reported that it generated 50,000 hits from unique visitors.

"Given the significance of this act, a greater sense of urgency was expected, but respondents had a wait-and-see approach," noted FTN analyst Jay McCanless in a research note.

McCanless added that a number of respondents mentioned that new marketing material was expected in the coming weeks, a factor that could influence September traffic levels.