Buyer’s enthusiasm falls to two-year low as market challenges bite



Consumers are growing increasingly optimistic about their personal finances, but the opposite is true when it comes to their ability to buy a home or qualify for a mortgage, according to the National Association of Realtor’s latest Housing Opportunities and Market Experience survey.

The survey found that just 68 percent of consumers are positive about their ability to buy a home, compared to 72 percent in the previous quarter. That represents the lowest level in two years, the NAR said.

Just as concerning is that renters in particular are feeling even less optimistic, with just 55 percent saying now is a good time to buy, compared to 60 percent previously. Renters identified barriers to homeownership including saving for a down payment, qualifying for a mortgage, student debt, worries about future income, and low credit scores.

As for current homeowners, older citizens and those who live in more affordable regions such as the South and Midwest, these displayed more optimism.

“The critical shortage of listings in most markets continues to spark a hike in home prices that is not easy for many buyers—especially first-time buyers—to overcome,” said NAR Chief Economist Lawrence Yun. “Adding more fuel to the affordability fire is the fact that mortgage rates have shot up to a four-year high in just a few months. Many house hunters are telling realtors that they are dispirited by the stiff competition for the short number of listings they can afford.”

On the other side of the equation, 74 percent of current homeowners state they believe now is a good time to buy, compared to just 69 percent one year ago.

“There’s no question that a majority of homeowners have amassed considerable equity gains since the downturn,” Yun said. “Home prices have grown a cumulative 48 percent since 2011 and are up 5.9 percent through the first two months of this year. 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.”

About Mike Wheatley

Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at mike@realtybiznews.com.

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