Housing and economic outlook shows optimism in housing market

by Lauren Clohessy

The majority of Americans are still feeling good about the housing market, according to the National Association of Realtors’ Housing Opportunities and Market Experience survey for the second quarter of 2018. The HOME survey found that 68 percent of surveyed Americans think now is a good time to buy a home and 75 percent think now is a good time to sell.

The number of households that believe the economy is improving slightly dropped from last quarter, but the number is still at a high from last year at 58 percent. Last year, 54 percent of respondents thought the economy was improving. 

When it comes to home prices, 68 percent of respondents think home prices increased in their areas during the last 12 months and 53 percent believe the prices will only continue to rise throughout the next six months.

Is Now a Good Time to Buy or Sell?

Of the 68 percent of respondents who believe now is a good time to buy, 39 percent strongly agree and 29 percent moderately agree it’s a good time to buy.

The findings show optimism in the housing market across the country. In the South, 73 percent of residents and 71 percent of Midwest residents believe now is a good time to purchase a home. Although, the same cannot be said for renters. Optimism among renters about homebuying dropped to 49 percent this quarter.

Experts blame the low inventory for hindering buyer’s optimism.

“Inventory remains the driving force in real estate, affecting everything for rising prices to household formation. Improving supply conditions is critical to improving buyer optimism and helping to remove some of the barriers holding back potential first-time buyers,” said NAR Chief Economist Lawrence Yun.

Despite the lack of inventory, Yun believes the increase in seller optimism will in turn create a rise in inventory.

The HOME survey found that respondents who strongly agree now is good time to sell rose 42 percent from last quarter and is now at 46 percent. Twenty-nine percent Americans surveyed moderately agree that now is a good time to sell.

The Effect of Homeownership

According to NAR President Elizabeth Mendenhall, homeowners are more likely to be involved in their community issues than renters.

When the HOME survey asked non-homeowners and homeowners about the homeownership in communities, 67 percent said homeownership strengthens communities a great deal. The number rises for current homeowners and those ages 65 and older.

“This involvement – homeowners are more likely than renters to vote, volunteer their time at local charities and support neighborhood upkeep – helps shape and strengthen our nation’s communities, as well as drive the national economy,” said Mendenhall.

As for the future of homeownership, 73 percent believe it will be harder for future generations to buy a home, while 11 percent think it will be easier.