The rest of 2017 appears to be a seller’s market, if industry leaders’ predictions about key market indicators prove to be correct.
On Wednesday, during the PAR Board of Directors meeting, I had the opportunity to discuss the annual Industry Leader Survey, which provided some interesting insight on our business.
Nearly 73 percent of leaders believe that buyers are more motivated than six months ago to purchase a new home. This is 13 percent more motivated than the same time last year. It also poses an intriguing dynamic for the industry when homeowners seem disinclined to list their properties. Thirty-nine percent of leaders indicated that sellers are neither more nor less motivated than last year to list their home for sale, and only 36 percent feel that sellers are more motivated (a drop of 10 percent from 2016). If sales prices rise in the next six months, as a whopping 75 percent of industry leaders predicted, more homeowners may become highly motivated to sell.
Excitement about the overall housing market appears to have tapered, but leaders retain largely positive outlooks on specific indicators of a healthy market. Essentially, leaders largely believe that the market will deliver more of what would be expected in a healthy economy, including higher sales prices, more offers and first-time homebuyers. Nearly half of all leaders feel that the market will stay about the same over the next six months, compared to only 23 percent a year ago. But just 5 percent of leaders feel the market will get worse in the next six months, compared to 10 percent who felt the same way in 2016. Not a single leader believes the market will get much worse in the next six months. Pairing this with the widely-held beliefs that sales prices and multiple-offer deals are on the rise, industry leaders appear to feel content with the market’s health.
Industry leaders expect interest rates to rise, but improvements in other areas will help retain confidence in the market. Sixty-five percent of leaders expect interest rates to increase in the next six months, compared to 43 percent who felt the same would happen in 2016. But current leaders are also more likely than last year to say that mortgage credit will be more available, and that sales prices and multiple offer deals will increase.
A $25 gift card was randomly awarded to one member completing the survey. Congratulations to James Cassidy from Keller Williams Limerick!
The Industry Leader Survey is conducted among more than 350 PAR committee members, including the board of directors. A total of 98 invited leaders (27 percent) completed the survey from May 2-5, 2017.