Home Selling Sentiment at Record High
Fannie Mae‘s Home Purchase Sentiment Index (HPSI) gained a single point from September’s level, rising to 75.5, as consumer views about purchasing and selling homes improved in October.
Whether now is a good time to buy a property drew positive replies from 30% of those polled, up 3 points from the September poll. When asked if it was an excellent time to sell a home, 77% replied, yes, a 5 point increase from the previous month. Additionally, home prices are expected to continue to grow by 39% of the respondents. The net positive number of those who said they aren’t worried about losing their work in the next 12 months is 69%, up 4 points from September.
The number of those expecting lower mortgage rates continues to decline. Only 5% of people expected any rate reduction in October, while 55% expected rates to rise and 33% expected them to stay the same. The final factor, change in household income, a net of 11% of respondents stated their household income had increased in the previous year.
As Travel Restrictions Ease, Real Estate Brokers Anticipate a ‘Flood’ of Overseas Wealthy Buyers
The United States will relax the travel ban for vaccinated visitors to around 33 nations, lifting restrictions that prohibited most foreign real estate investors from viewing and purchasing properties in the country. As a result, for the first time in 20 months, buyers from Europe, China, Brazil, and India may enter the United States. Brokers in cities popular with the wealthy from other countries, such as New York, Miami, and Los Angeles, say they have a long list of showings scheduled in the coming weeks from buyers eager to invest, likely to keep demand for housing very strong.
According to sales data, the influx of foreign buyers could result in additional sales worth tens of billions of dollars. The National Association of Realtors stated that foreign purchasers spent $267 billion on U.S. real estate in 2018 and $183 billion in 2019, before the outbreak. Their expenditure declined to $107 billion in 2021, indicating high pent-up demand due to buyers’ inability to tour or see properties.
What Buyers Should Expect For the Winter Housing Market
The housing market in the United States has always been weak in the fall, but somehow the pandemic housing market appears to be thriving. According to a new Realtor.com study, the average U.S. home spent fewer days on the market from March to October than the fastest-selling month from 2016 to 2020.
The average home remained on the market for 45 days in October, slightly longer than the previous month’s average of 43 days. Nonetheless, properties sold faster in October than in any other month in recent years, including 2020 (-8 days) and 2019 (-21 days). Properties are likewise more costly. Last month, the typical listing price was $380,000, which was 9% higher than in October 2020. Currently, there are 636,606 active listings, with a 2% decline in inventory from the same month last year. This limited pool of properties for sale has characterized the pandemic market.
“The fact that we still have relatively low inventory levels heading into this last part of the year suggests that the market is still very competitive and likely to remain so,” says Danielle Hale, the chief economist for Realtor.com.
Next weeks potential market moving reports are:
- Monday, November 15th – No Report
- Tuesday, November 16th – NAHB Home Builders’ Index, Business Inventories, Retail Sales
- Wednesday, November 17th – Building Permits (SAAR), Housing Starts (SAAR)
- Thursday, November 18th – Initial Jobless Claims, Continuing Jobless Claims
- Friday, November 19th – No Report
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