The number of households feeling confident about the economy and their current financial situation is decreasing, which directly impacts their housing sentiments, according to the National Association of Realtors’ Housing Opportunities and Market Experience (HOME) survey. Homeowners are increasingly positive about selling their properties, though non-homeowners have anxieties about their ability to save for a down payment and qualify for a mortgage.
In the first quarter of 2018, only 68 percent of buyers reported that they believe it is a good time to buy a home compared to 72 percent last quarter. However, renters aren’t as optimistic, with 55 percent saying now is a good time to buy, down from 60 percent last quarter.
“The critical shortage of listings in most markets continues to spark a hike in home prices that is not easy for many buyers — and especially first-time buyers — to overcome,” said NAR Chief Economist Lawrence Yun.
In comparison, in the first quarter of the year, the share of homeowners who believe now is a good time to sell increased 3 percent from last quarter to 74 percent compared to 69 percent in the first quarter of 2017.
- Sixty percent of households in the first quarter of this year believe the economy is improving compared to 52 percent in the fourth quarter of 2017.
- The HOME survey’s monthly Personal Financial Outlook Index, which measures respondents’ confidence that their financial situation will be better in six months, rose from 59.1 in December 2017 to 63.8 in March 2018. The index was 62.6 in March 2017.
- Limited income (47 percent), student loan debt (30 percent), rising rents (28 percent) and medical costs (14 percent) were the top obstacles cited the potential reasons why qualifying for a mortgage would be difficult.
“There’s no question that a majority of homeowners have amassed considerable equity gains since the downturn. Home prices have grown a cumulative 48 percent since 2011 and are up 5.9 percent through the first two months of this year,” Yun said. “Supply conditions would improve measurably, and ultimately lead to more sales, if a growing number of homeowners finally decide that this spring is the time to list their home for sale.”