Homebuyer confidence is on the upswing - The Explorer: Features

Homebuyer confidence is on the upswing

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Andy Warren

Posted: Wednesday, July 9, 2014 4:00 am

As we enter peak home-buying season, it appears that overall consumer confidence is on the rise, according to the latest information from Fannie Mae and other sources.

The Fannie Mae National Housing Survey reveals 38 percent of the share of respondents are beginning to think now is a good time to sell their home — up from 26 percent last year at the same time. Fifty-two percent of respondents also believe it’s easy to get a mortgage, matching the all-time survey high.

These numbers, combined with a rising demand in the residential housing market and expert predictions of economic growth still to come in 2014, point to a broader overall acceleration in the real estate market. And it doesn’t appear to be slowing down anytime soon.

“Looking forward, we expect to see a pickup in economic growth later in the year, and this may boost the confidence of prospective buyers and sellers,” said Doug Duncan, senior vice president and chief economist at Fannie Mae.

Although the housing recovery continues to be erratic, a problem that Duncan attributes to rising mortgage rates and a lack of supply, consumers are less pessimistic about their financial stability and more optimistic about the current selling market.

“Consumer attitudes about the current home-selling environment have improved and now are at the most favorable level we’ve seen in the survey’s four-year history,” said Duncan.

According to the survey results, concerns about job loss among employed consumers has hit a record low, as well, further reinforcing consumer confidence.

“These results are in line with our expectations for increased housing activity and gradual strengthening of the housing market going into the summer selling season,” said Duncan.

In other good news, the Commerce Department recently reported that home sales in May jumped 18.6 percent, the largest one-month gain in 22 years. Analysts credit job creation, which has exceeded 200,000 workers for four consecutive months, and stable borrowing costs at historically low levels, for giving Americans the confidence they need to re-enter the housing market.  

“Confidence is percolating up through the economy, making people reach for big purchases like new homes,” said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York.

  

Andy Warren is president of Arizona homebuilder Maracay Homes, part of the TRI Pointe Homes family of builders.  He serves on the Board of Directors and as an Executive Committee member with the Greater Phoenix Economic Council and is a past board member of the Home Builders Association of Central Arizona.  He is also a member of Greater Phoenix Leadership and an active member of the Urban Land Institute.

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1 comment:

  • John Flanagan posted at 12:50 pm on Fri, Jul 11, 2014.

    John Flanagan Posts: 333

    AH...but the untold part of the story is that the buyers market is indeed milking the blood out of the sellers in Arizona, hardworking people who have seen the values of their homes plummet in a continuing downward spiral. So the realty companies and appraisers keep the prices artificially low....screwing the sellers out of thousands of dollars in lost equity. Of course, no mention of reducing commissions or closing fees, but sellers are told....too bad....it is the economy. At one time, a home easily brought a profit when a homeowner sold it, but now most people take a big loss, break even, or make a tiny profit, if any at all. I don't know who you can blame. Wall Street? The banks? In any case....owning a home for a few years....after paying top market value for it years earlier...means prepare to sell at a loss if you decide to move or downsize. I don't care about these glowing public relations reports.....the American Dream is alive for buyers maybe...but for sellers it is a terrible nightmare.


     

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