A dearth of homes for sale, declining affordability, appraisal issues and lender processing delays are the key issues.
CHICAGO – September 2, 2016 – A dearth of homes for sale, declining affordability, appraisal issues and lender processing delays are the key issues affecting sales, according to the latest Realtors® Confidence Index Survey, a survey sent to more than 50,000 real estate professionals about their latest transactions.
That said, most Realtors remain confident about the outlook for the housing market for the next six months across all property types. The index showed confidence registering above 50, and confidence is higher than a year ago.
Most of the Realtors surveyed say that with home prices becoming less affordable they expect prices to moderate, growing at a slower pace of 3.3% in the next 12 months.
Many real estate professionals report that tight inventories of homes for sale have led to multiple offers and price increases in their markets. In July, 41% of homes were sold at or above the list price, up from 36% one year ago, according to the survey.
The tight supply is making affordability a growing problem, real estate professionals report. First-time buyers, in particular, are struggling to save for a downpayment. The median family income is up by 11% compared to January 2012, while the median price of an existing home has risen by 62% over that time.
The report found that homes are still generally affordable, but the gap between actual and qualifying income of first-time homebuyers has narrowed. As of the second quarter of 2016, NAR estimates that the median income of first-time homebuyers is $44,703, only slightly above the qualifying income of $42,720.
While the majority of transactions are being settled on time, Realtors still report that 32% of transactions faced a delay and 6% were terminated from May to July. The top reasons for a delay were due to issues related to obtaining financing (41%); appraisal issues (27%); home inspection or environmental issues (11%); and titling or deed issues (10%).
Source: REALTORS® Confidence Index: July 2016
© 2016 Florida Realtors®. All rights reserved. Reprinted with permission.