The majority of REALTORS® remain “strongly” confident that the single-family home market will perform better over the next six months than it did a year ago, according to the latest REALTORS® Confidence Index, a survey of more than 50,000 practitioners. Job growth and low interest rates — the 30-year fixed-rate mortgage is holding below 4 percent — are helping to buoy demand, the survey indicates.
The majority of REALTORS® also say they expect home prices to rise on strong buyer demand by an average of 3.2 percent over the next 12 months. However, “REALTORS® expect the recent strong price growth to moderate as rising prices have made homes unaffordable for many, with home prices almost on par with their levels prior to the housing downturn,” according to the report.
The median price of all existing homes in August was $230,200, which nearly matches the peak price of $230,900 in July 2006.
REALTORS® are most upbeat about price growth in Florida, with the median home price expected to rise 5 percent to 6 percent there. There’s also high optimism about price growth in Washington, Oregon, and Colorado, states where the median home price is expected to rise 4 percent to 5 percent over the next 12 months.
In the latest REALTOR® Confidence survey, respondents also report that the biggest market challenges continue to be tight inventory, decreasing affordability, tight mortgage availability, and slow, excessively conservative appraisals. Many respondents also express concerns over the difficulty of obtaining financing for condo purchases, since many condos are not FHA- or GSE-eligible. (Read more: Why Condo Loans Can Be So Hard to Get)
Source: “REALTORS® Confidence Index: Report on the September 2015 Survey,” National Association of REALTORS® (Oct. 22, 2015)