Housing is a complex creature – the market can be on fire, but optimism can wane nonetheless. The National Association of Realtors (NAR) is reporting that despite solid job creation, the strength of the economy, and increased economic growth, many households are less keen on believing now is a good time for buying or selling, and are overall less confident about the economy.
This comes as a result of the fourth quarter HOME (Housing Opportunities and Market Experience) survey, which samples US households by a random digit-dial and was conducted by TehcnoMetrica Market Intelligence that gathered 2,705 households. The HOME survey collects data on a monthly basis and is focused on identifying real estate trends.
Despite an improving economy, more hiring, and low mortgage rates, optimism in home sales was not as expected, according to Lawrence Yun, Chief Economist for the NAR.
In general, most prospective home buyers had to deal with a lack of inventory – less construction, fewer sellers, and a lack of affordability.
Reduced economic confidence in the face of the economy’s improvements persisted, with more households feeling less secure about their financial situation, and less people believing the economy is improving. Simply put – they aren’t feeling it.
Renters are less engaged to buy, as demonstrated by a two percent decrease in renters believing now is a good time to go get that home.
Overall – the people most excited to purchase homes are current homeowners, households with income above $100,000, and those living in the Midwest and South. If you live in the West, it is likely that you believe yourself to be in a good market for selling a home.
Overall, people more firmly believe it is a good time to sell their home over last year, which can spell some good news for potential buyers in 2018, as more people may be comfortable putting their homes on the market.
The key is that housing supply must increase. New builds and more sellers placing homes on the market will improve confidence about the housing supply and can work in tandem with a better job market and improved economy to make households feel more optimistic about their #future.