Photo: Robert Clark
It’s a seller’s market, and even though the majority of Americans feel that now is a good time to sell their home, they’re not. The apparent mismatch between the mindset and behavior of sellers could be part of a cycle that sellers themselves are fostering, according to the results of a survey conducted by the National Association of Realtors (NAR).
During the second quarter of this year, some 71 percent of all respondents felt that now was a good time to sell a home, up from 69 percent the previous quarter. This quarter’s result was up significantly from the 61 percent recorded last year at the same time.
Regionally, seller confidence in the Midwest surpassed the West for the first time this quarter, with 76 percent and 72 percent of respondents, respectively, saying that now was a good time to sell.
But while seller confidence may have grown, the number of homes for sale has decreased. National inventory has fallen each month year-over-year for the last 24 months, driving prices up. And this could be causing home sellers to hesitate.
“On the one hand, a homeowner in a seller’s market will realize their home will likely sell quickly, and at or above list price. However, some homeowners aren’t selling because they know they’ll end up being buyers in this competitive environment of limited options and multiple buyers competing,” Adam DeSanctis, NAR’s Economic Issues Media Manager, tells BuzzBuzzNews.
National existing home sales were up just under 6 percent year-over-year last month, but it’s still not enough to meet current demand, DeSanctis says.
The pace of new home construction, which is well below historic levels, could also be keeping sellers in their homes longer.
“One thing to look for is the trend in new home construction – which is still inadequate. Many homeowners when selling look to trade-up to a larger home, which is typically a new one. If new inventory increases, that would ultimately persuade more homeowners to sell and move,” DeSanctis tells BuzzBuzzNews.
DeSanctis adds that the overall hope is that this increase in positive sentiment will translate to more homeowners listing their home for sale, which could ease some of the inventory issues — especially in hot markets.
Yet despite rising home prices and low inventory, 70 percent of respondents felt that now is a good time to buy a home, and over 40 percent believed that homes are affordable for most buyers. Meantime, over 30 percent of respondents who do not currently own a home believed that getting a mortgage would be difficult.
Overall, respondents were less confident about the economy and their current and future financial situation than the previous quarter, despite continuous job gains.
Click here to read the entire report.