HOME Survey: Economic and Financial Outlook, Attitudes About Home Buying and Selling on the Rise

Washington, D.C. – September 25, 2017 (nar.realtor) Existing-homes sales have retreated in four of the past five months, but new survey findings from the National Association of Realtors® indicate it is not because of a lack of confidence from consumers about buying and selling a home, or based on their views about the direction of the economy and their finances.

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That’s according to NAR’s third quarter Housing Opportunities and Market Experience (HOME) survey(1) , which also found that two-thirds of households think saving for a down payment is challenging, and roughly half of renters expect to pay more in rent next year.

This quarter, there appears to be a revival from renters that now is a good time to buy a home. After dipping to roughly half of renters last quarter (52 percent), the share who believe now is a good time climbed to 62 percent (60 percent a year ago). Overall, current homeowners (80 percent), households with higher incomes and those living in the more affordable Midwest and South regions are the most optimistic about buying right now.

Amidst the steady gains in home values seen in many parts of the country, the share of homeowners that believe now is a good time to sell is also inching higher. Eighty percent of homeowners think now is a good time to list their home for sale (a new survey high), which is up from last quarter (75 percent) and even more so than a year ago (67 percent).

Lawrence Yun, NAR chief economist, says it is great news that homebuyer and seller optimism is advancing, but it remains unclear if it will actually translate to more sales. “The housing market has been in a funk since early spring because of the ongoing scarcity of new and existing homes for sale,” he said. “The pace of new home construction has not meaningfully broken out this year, and not enough homeowners at this point have followed through with their belief that now is a good time to sell. As a result, home shoppers have seen limited options, stiff competition and weakening affordability conditions.”

Added Yun, “Buyer demand is robust this fall, but the disappointing reality is that sales will continue to undershoot their full potential until supply levels significantly improve.”

Economic and financial outlook brightens

More households this quarter (57 percent) believe the economy is improving compared to the second quarter (54 percent) and a year ago (48 percent). Continuing the complete reversal from a year ago, those living in rural and suburban areas were more optimistic about the economy than respondents residing in urban areas. A majority of homeowners and those with incomes above $50,000 also had a positive outlook on the economy.

The rebound in economic confidence this quarter are also giving households increased assurances about their financial situation. The HOME survey’s monthly Personal Financial Outlook Index2, showing respondents’ confidence that their financial situation will be better in six months, jumped from 57.2 in June to 62.0 in September. A year ago, the index was 58.6.

“Jobs are plentiful, wage growth is finally showing signs of life, home values are up considerably in the past five years and the stock market is at record highs,” said Yun. “The economy is not perfect, and growth overall is still sluggish, but the financial health of the typical household looks as healthy as it has since the recession.”

Most renters likely to continue renting – even if their rent increases

This quarter, non-homeowners were asked if they expect their rent to increase over the next year, and given their current financial situation, what impact paying more in rent would have on their living arrangements.

Roughly half of current renters expect to pay more in rent next year (51 percent). If in fact their rent does increase, most will either resign their lease anyway (42 percent) or move to a cheaper rental. Only 15 percent of respondents will consider buying a home.

“Even though the typical down payment of a first-time buyer has been 6 percent for three straight years, two-thirds of respondents indicated that saving for one is difficult right now,” said Yun. “Rents and home prices have outpaced incomes in the past few years, and this is undoubtedly impacting their ability to put aside savings for a home purchase, even if they increasingly believe it’s a good time to buy. Heading into next year, higher home prices and limited inventory in the affordable price range will likely continue to hold back a share of renters who would prefer to be homeowners.”

About NAR’s HOME survey
In July through early September, a sample of U.S. households was surveyed via random-digit dial, including a mix of cell phones and land lines. The survey was conducted by an established survey research firm, TechnoMetrica Market Intelligence. Each month approximately 900 qualified households responded to the survey. The data was compiled for this report and a total of 2,709 household responses are represented.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

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1. NAR’s Housing Opportunities and Market Experience (HOME) survey tracks topical real estate trends, including current renters and homeowners’ views and aspirations regarding homeownership, whether or not it’s a good time to buy or sell a home, and expectations and experiences in the mortgage market. New questions are added to the survey each quarter to reflect timely topics impacting real estate.

HOME survey data is collected on a monthly basis and will be reported each quarter. New questions will be added to the survey each quarter to reflect timely topics impacting the real estate marketplace. The next release is scheduled for Monday, June 12, 2017 at 10:00 a.m. ET.

2. Index ranges between 0 and 100: 0 = all respondents believe their personal financial situation will be worse in 6 months; 50 = all respondents believe their personal financial situation will be about the same in 6 months; 100 = all respondents believe their personal situation will be better in 6 months.

Media Contact:

Adam DeSanctis
(202) 383-1178
Email

A Seller’s Market? Consumers Express Diverging Sentiment on Home Buying and Selling in May

Washington, D.C. – June 7, 2017 (PRNewswire) The Fannie Mae Home Purchase Sentiment Index® (HPSI) decreased 0.5 percentage points in May to 86.2. The slight decrease can be attributed to decreases in three of the six HPSI components being larger on net than the three increases. The net share of Americans who reported that now is a good time to buy a home reached a record low after falling 8 percentage points, while the net share who reported that now is a good time to sell a home reached a record high, increasing 6 percentage points. This is only the second time in the survey’s history that the net share of those saying it’s a good time to sell surpassed the net share of those saying it’s a good time to buy. Americans also expressed greater belief that mortgage rates will go down over the next 12 months, with that component increasing 5 percentage points. Finally, the net share of consumers who think home prices will go up fell by 5 percentage points this month.

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“High home prices have led many consumers to give us the first clear indication we’ve seen in the National Housing Survey’s seven-year history that they think it’s now a seller’s market,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “However, we continue to see a lack of housing supply as many potential sellers are unwilling or unable to put their homes on the market, perhaps due in part to concerns over finding an affordable replacement home. Prospective homebuyers are likely to face continued home price increases as long as housing supply remains tight.”

HOME PURCHASE SENTIMENT INDEX – COMPONENT HIGHLIGHTS

Fannie Mae’s 2017 Home Purchase Sentiment Index (HPSI) decreased in May by 0.5 percentage points to 86.2. The HPSI is up 0.9 percentage points compared with the same time last year.

  • The net share of Americans who say it is a good time to buy a home fell 8 percentage points to 27%, reaching a new survey low
  • The net percentage of those who say it is a good time to sell increased by 6 percentage points to 32%, rising from last month’s decline to a new survey high.
  • The net share of Americans who say that home prices will go up decreased by 5 percentage points in May to 40%.
  • The net share of those who say mortgage rates will go down over the next twelve months rose 5 percentage points to -52%, following the trend from last month.
  • The net share of Americans who say they are not concerned about losing their job fell 6 percentage points to 71%, back near the level seen in March.
  • The net share of Americans who say their household income is significantly higher than it was 12 months ago rose 5 percentage points to 18% in May.

ABOUT FANNIE MAE’S HOME PURCHASE SENTIMENT INDEX

The Home Purchase Sentiment Index (HPSI) distills information about consumers’ home purchase sentiment from Fannie Mae’s National Housing Survey® (NHS) into a single number. The HPSI reflects consumers’ current views and forward-looking expectations of housing market conditions and complements existing data sources to inform housing-related analysis and decision making. The HPSI is constructed from answers to six NHS questions that solicit consumers’ evaluations of housing market conditions and address topics that are related to their home purchase decisions. The questions ask consumers whether they think that it is a good or bad time to buy or to sell a house, what direction they expect home prices and mortgage interest rates to move, how concerned they are about losing their jobs, and whether their incomes are higher than they were a year earlier.

ABOUT FANNIE MAE’S NATIONAL HOUSING SURVEY

The most detailed consumer attitudinal survey of its kind, Fannie Mae’s National Housing Survey (NHS) polled 1,000 Americans via live telephone interview to assess their attitudes toward owning and renting a home, home and rental price changes, homeownership distress, the economy, household finances, and overall consumer confidence. Homeowners and renters are asked more than 100 questions used to track attitudinal shifts, six of which are used to construct the HPSI (findings are compared with the same survey conducted monthly beginning June 2010). As cell phones have become common and many households no longer have landline phones, the NHS contacts 60 percent of respondents via their cell phones (as of October 2014). For more information, please see the Technical Notes. Fannie Mae conducts this survey and shares monthly and quarterly results so that we may help industry partners and market participants target our collective efforts to stabilize the housing market in the near-term, and provide support in the future. The May 2017 National Housing Survey was conducted between May 1, 2017 and May 23, 2017. Most of the data collection occurred during the first two weeks of this period. Interviews were conducted by Penn Schoen Berland, in coordination with Fannie Mae.

DETAILED HPSI & NHS FINDINGS

For detailed findings from the May 2017 Home Purchase Sentiment Index and National Housing Survey, as well as a brief HPSI overview and detailed white paper, technical notes on the NHS methodology, and questions asked of respondents associated with each monthly indicator, please visit the Surveys page on fanniemae.com. Also available on the site are in-depth special topic studies, which provide a detailed assessment of combined data results from three monthly studies of NHS results.

Fannie Mae helps make the 30-year fixed-rate mortgage and affordable rental housing possible for millions of Americans. We partner with lenders to create housing opportunities for families across the country. We are driving positive changes in housing finance to make the home buying process easier, while reducing costs and risk. To learn more, visit fanniemae.com and follow us on twitter.com/fanniemae.

U.S. Homeowners Can Spend $15,000 in Hidden Costs to Sell a House

From closing costs to basic home prep projects like carpet cleaning and staging, homeowners can spend between $10,000 and $55,000 to sell a house, depending on location

Seattle and San Frncisco – May 18, 2017 (PRNewswire) Nationally, U.S. homeowners spend $15,190 on average in extra or hidden costs associated with selling their home, according to a new analysis from Zillow® and Thumbtack(i). Since most (63 percent) of today’s sellers have never sold a home before, some of these costs could come as a surprise(ii).

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To help with budgeting, Zillow and Thumbtack calculated several common, but often overlooked, seller expenses including sales taxes and agent commissions, as well as five optional home prep projects.

More than eight out of 10 home sellers make improvements before listing(iii). While some sellers prefer to complete these projects themselves, those who outsource can expect to spend more than $2,650 nationally to cover staging, carpet cleaning, interior painting, lawn care and house cleaning – five of the most popular seller home prep projects. Labor costs vary significantly by region, so sellers in Los Angeles pay an average of $4,000 for the same projects, compared to sellers in Columbus, Ohio, who pay $1,500.

The two largest closing costs are agent commissions and in most states, sales or transfer taxes. Nationally, sellers spend $12,532 for both closing costs on the median home. Since they are percentages of the home’s sale price, sellers in hot coastal markets like San Francisco pay $51,520 on the median home, the highest of the metros analyzed. Sellers in Indianapolis pay the least ($8,238) as home values are lower and the state has no transfer tax.

From title insurance to escrow fees, sellers are responsible for a variety of other smaller closing costs. Even though selling a home costs money, most (73 percent) sellers are still satisfied with the transaction(iv). To estimate potential profit, sellers can use Zillow’s Sale Proceeds Calculator. It factors in the home’s sale price, mortgage balance and agent commissions, along with other common seller fees.

“One of the biggest regrets sellers have is not starting the process early enough,” says Jeremy Wacksman, Zillow Group chief marketing officer. “For those planning to sell this year, take your time to research all the costs you could be responsible for and how they may affect your profit, or even budget for your next home. Partner with a great agent who can help you understand the nuances in your market – from what taxes or closing costs you should expect, to which home renovation projects can help attract the right buyer.”

“Sellers need to consider these additional, often necessary costs when planning to put their home on the market,” says Lucas Puente, Thumbtack economist. “While it’s clear these costs vary widely, often times the easiest way to ensure a home is fully prepared to be sold is to hire local, skilled professionals to help with basic home projects.”

More information about Zillow and Thumbtack’s Hidden Costs of Selling Report is available on Zillow’s blog, Porchlight.

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Zillow

Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. Zillow serves the full lifecycle of owning and living in a home: buying, selling, renting, financing, remodeling and more. In addition to Zillow.com®, Zillow operates the most popular suite of mobile real estate apps, with more than two dozen apps across all major platforms. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ: Z and ZG) and headquartered in Seattle.

Zillow and Zillow.com are registered trademarks of Zillow, Inc.

Thumbtack

Thumbtack is a local services marketplace that connects customers who need to get things done with local professionals who can help. From plumbers and painters to DJs and personal trainers, Thumbtack helps millions of customers find the right professional for their project in over 1,000 categories. This translates to more than $1 billion in annual revenue for our professionals across the U.S., helping them grow their businesses on their own terms. Founded in 2009 and headquartered in San Francisco, Thumbtack is backed by over $250 million in investment from Sequoia Capital, Google Capital, Tiger Global Management, Javelin Investment Partners and Baillie Gifford.

i Zillow and Thumbtack’s Hidden Costs of Selling report factored in closing costs (transfer taxes and agent commotions) and several basic home prep costs. Zillow computed transfer taxes by using the tax rate for the primary state within each metro area (in cases where metro areas cross one or more state lines), which were then applied to the median home value for that area. Zillow also assumed 6 percent for real estate agent commissions and applied it to the median home value for each metro area. For the basic seller home prep costs, Thumbtack looked at tens of thousands of quotes from small business professionals around the country and determined the average cost for each expense within the selected metros. For the purposes of this analysis, carpet cleaning, interior painting, lawn care, home staging and house cleaning were identified as five of the most popular home maintenance-related projects completed by Thumbtack users prior to selling a home.

ii According to the 2016 Zillow Group Report on Consumer Housing Trends.

iii According to the 2016 Zillow Group Report on Consumer Housing Trends.

iv According to the 2016 Zillow Group Report on Consumer Housing Trends.

Redfin Survey: One in Four Home Sellers Report Having No Concerns About Selling

Sellers are Less Likely to be Worried about Finding a Replacement Home Going into Spring

Seattle, WA – May 1, 2017 (redfin.com) One in four home sellers said they have no concerns about selling this spring, according to an April survey of nearly 900 homeowners conducted by Redfin (www.redfin.com), the next-generation real estate brokerage.

The 179 survey respondents who indicated that their home was currently listed for sale or that they were planning to list in the coming year (considered “home sellers” for reporting purposes) ranked “none” as their most common response when asked to select their top three concerns about selling. In a similar survey conducted in January, this response was the eighth-most common, with 16 percent of sellers choosing it.

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Last month, 18 percent of sellers expressed concern about finding another home to buy, down from 24 percent in January.

“Despite strong sentiment among current home sellers, the numbers show prospective sellers have been very slow to list their homes. New listings dropped 2.3 percent in the first three months of the year compared to the same period last year,” said Redfin chief economist Nela Richardson. “Would-be sellers are likely waiting for prices to peak; they’re trying to time the market to fetch the largest possible gain. Whether the confidence of the current cohort of sellers translates into more new listings in the coming months is the number one question that determines whether 2017 will be a good year or a great year.”

Other findings that reveal a high level of confidence among sellers this spring include:

1. 21.1 percent of sellers said they would price high since negotiations are inevitable, up from 15.4 percent in January. Still, most sellers reported that they would price in the mid-range according to comparable homes.

2. When asked about the balance of power in their market, 20 percent said sellers have all the power, up from 13.1 percent in January.

To read the full report, complete with charts and insights from Redfin real estate agents, visit:
www.redfin.com.

About the Survey

Redfin’s survey was conducted between Apr. 12 and Apr. 17, and includes responses from 896 homeowners in 38 states and Washington, D.C. Of this group of respondents, 179 either said their home was currently listed for sale or expressed plans to sell within the next year, and are therefore considered “home sellers” for the purpose of this report.

About Redfin

Redfin (www.redfin.com) is the next-generation real estate brokerage, combining its own full-service agents with modern technology to redefine real estate in the consumer’s favor. Founded by software engineers, Redfin has the country’s #1 brokerage website and offers a host of online tools to consumers, including the Redfin Estimate, the automated home-value estimate with the industry’s lowest published error rate. Homebuyers and sellers enjoy a full-service, technology-powered experience from Redfin real estate agents, while saving thousands in commissions. Redfin serves more than 80 major metro areas across the U.S. The company has closed more than $40 billion in home sales through 2016.

Contact Redfin

Redfin Journalist Services:
Jeffery Marino, 206-588-6863
press@redfin.com

Best Time to Buy a Home is Late Summer

– Home buyers will find the most inventory and more frequent price cuts in August and September

– Home shoppers will find the most homes for sale in August

– Active listings are more likely to have a price cut in the summer than any other season

– Homes that sell during spring months are more likely to sell above list price

Seattle, WA – May 4, 2017 (PRNewswire) Patience pays off, for home buyers. The best time to buy a home is late summer, when there are the most options and frequent price cuts.

As summer approaches, overall inventory of homes for sale is down 5.3 percent from a year ago[i], signaling another competitive home shopping season for buyers this year. Even in markets that have seen a recent uptick in the number of homes for sale, inventory is still well below the levels of five years ago.

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A new Zillow® analysis[ii] shows that there are more homes for sale at the end of summer than at any other time of year, giving buyers the greatest selection. In most major metros, August had more for-sale listings than any other month. In Los Angeles, for example, there were about 8,000 more homes for sale in August than in April. In Seattle, the difference was about 5,000 listings.

At the same time, price cuts are more common as home sellers start to worry about not selling their homes. Across the country, 15 percent of listings in August have had price reductions. In most large markets, buyers are most likely to find a home with a reduced price tag in either August or September.

The home shopping process can be stressful for buyers. On average, buyers spend more than four months shopping for a home, and put in at least two offers before buying, according to the 2016 Zillow Group Report on Consumer Housing Trends. Buyers who have been unsuccessful so far may find better luck in the later months of the summer.

“In such a competitive housing market, it’s easy for buyers to get frustrated when they are putting in multiple offers without success,” said Zillow Chief Economist Dr. Svenja Gudell. “Buyers who start their home search in the spring may still be looking months later – but for those who can wait it out, the end of summer will bring more favorable conditions. Homes that may have been overpriced earlier in the year are more likely to have a price reduction, and those listings passed over in earlier months may look better with a fresh perspective.”

Spring traditionally kicks off the home shopping season – most new listings hit the market during these months. April in particular had more new listings than any other month in 2016. However, shopping in spring can be competitive, and these homes are more likely to sell for a premium. Homes listed in late spring sell faster and for a $1,500 premium on average, according to Zillow’s Best Time to List analysis.

Share of Active Listings with a Price Cut – 2016

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For the full data, visit Zillow Research: http://www.zillow.com/research/strategy-best-time-to-buy-15066/

Zillow

Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ: Z and ZG), and headquartered in Seattle.

[i] https://www.zillow.com/research/march-2017-market-report-14837/

[ii] This analysis analyzed listings on Zillow in 2016

Fundamentals From the Field: Staging a Bathroom to Be a Strong Selling Point

With the spring selling season upon us, you want to make sure every corner of your listing is show-ready for the rush of buyers. You know the bathroom can make as big an impression as the bedroom or living room, but how often do you go the extra mile to stage it just as perfectly? Home staging expert Tori Toth has some simple ideas for making the bathroom a stronger selling point.