Majority feel 2018 fourth quarter is good time to buy home, says Realtor survey
New findings from a National
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12 West Hawaii Real Estate | December 21, 2018
Association of Realtors
survey show that despite
a favorable view on the
economy and the direction of home
prices, the sentiment on home buying
continued to diminish at the close of
2018 – though a majority still think
it is a good time to buy. Consumer
sentiment about home buying
weakened in the fourth quarter with
only 34 percent strongly indicating
it is now a good time to buy, down
from 39 percent in the third quarter
and 43 percent one year ago. The
percentage of those who believe
that is not a good time to buy was
unchanged in the fourth quarter,
remaining at 37 percent, though up
from 28 percent one year ago.
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NAR’s fourth quarter Housing
Opportunities and Market Experience
(HOME) survey also found that
a majority of those polled, 59
percent, believe that the economy is
improving. Optimism is the greatest
among those who earn $50,000 or
more. Fifty-three percent of those
in urban areas said the economy is
improving, compared to 71 percent of
respondents in rural areas.
NAR’s chief economist Lawrence
Yun says rapid price increases
have affected the marketplace.
“Consistently fast-rising home prices
well in excess of income growth
over recent years have left buyers
frustrated while slowly enticing
would-be sellers to consider listing.”
From 2012 to 2018, median home
prices rose 44 percent, while average
hourly wage earnings increased by
just 16 percent. NAR’s most recent
survey asked about home prices over
the last 12 months. Sixty-three percent
of respondents feel that prices have
increased in their communities over
the last 12 months, down from the
third when 70 percent of respondents
believed that prices had increased.
Thirty percent feel housing prices
within their communities have
remained the same.
Americans living in the West,
those with annual incomes of over
$100,000 and those 45 to 54 years
of age are most likely to report
that prices have increased in their
neighborhoods. Additionally, 67
percent of homeowners, 56 percent
of renters and 50 percent of those
living with someone else also felt
home prices in their communities
increased. Forty percent of those
earning less than $50,000 reported
that home prices had stayed the
same. The national median home
price as of October was $255,400,
compared to $382,900 in the West.
Respondents were also asked
for their views on home prices
in the next six months. Forty-one
percent predict home prices in their
communities will stay the same,
unchanged from last quarter but up
slightly from 40 percent in 2018’s
second quarter.
those who said the economy
is advancing, 59 percent live in the
West, which Yun found interesting.
“The West region has a strong jobcreating
economy, yet it is the West
region showing the weakest buyer
sentiment because the West region is
the least affordable,” said Yun.
Among those who do not
presently own a home, 29 percent
of those polled said that it would be
very difficult to qualify for a mortgage
and 30 percent believe that it would
be somewhat difficult given their
current financial situation (compared
to 28 and 31 percent last quarter).
Yun says some of the fourth
quarter findings imply that the
softening home buying sentiment
is less a result of potential buyers
holding off purchases in anticipation
of lower home prices, but more
related to concerns over qualifying
for a higher mortgage and the
lack of access to affordable home
listings. “Perhaps some communities
designated as Opportunity Zones can
draw real estate developers using
tax incentives to build affordable
housing,” Yun said.
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