Home sellers are feeling good about 2021

Home sellers are chomping at the bit. As the economy reopens, vaccinations continue to roll out and stimulus checks reach bank accounts across America, home sellers are increasingly optimistic.

And despite fierce bidding wars, competition from institutional investors and sore wrists from writing dozens of heartfelt letters to home sellers, even buyers are growing in courage these days.

Fannie Mae’s Home Purchase Sentiment Index (HPSI), a composite index designed to track the housing market and consumer confidence to sell or buy a home, increased in March by 5.2 points to 81.7.

Four of the HPSI’s six components increased month over month, including the components related to homebuying and home selling conditions, household income, and home prices. The mortgage rate outlook component experienced the only decline in March’s HPSI, with the latest results indicating that only 6% of consumers believe that mortgage rates will decrease over the next 12 months.

Fannie Mae Senior Vice President and Chief Economist Doug Duncan said the March HPSI increase reflects consumer optimism toward the housing market and the economy in general.


Real estate agents and LOs: the great collaboration

Technology has given consumers the power of choice and expedited the entire real estate purchasing process. Successful agents, brokerages and loan officers of the future are going to rely significantly on technology to find, nurture and engage with buyers and home sellers while also playing an expanding role as personal advisors.

Presented by: Propertybase

“There might even more intensity this year, since 2020’s spring homebuying season was limited by virus-related lockdowns,” Duncan said. “Home-selling sentiment experienced positive momentum across most consumer segments, nearly reaching pre-pandemic levels and generally indicative of a strong home seller’s market.”

Duncan added that home sellers are citing high home prices and tight inventory as primary reasons why it’s a good time to sell.

“Alternatively, while the net ‘good time to buy’ component increased month over month, it has not recovered to pre-pandemic levels, as the homebuying experience continues to prove difficult for many of the same reasons,” he said.

(The percentage of respondents who say it is a good time to buy a home increased from 48% to 53%, while the percentage who say it is a bad time to buy decreased from 43% to 40%.)

Mortgage applications decreased 2.2%, according to the March 31 report from the Mortgage Bankers Association. However, purchase activity during the last week of March was up 6% year-over-year, with the unadjusted purchase index 39% higher than the same week one year prior.

That’s largely reflected in the HPSI. The percentage of respondents who believe it is a good time to sell a home increased from 55% to 61%, while the percentage who say it’s a bad time to sell decreased from 35% to 28%.

The percentage of respondents who believe home prices will go up in the next 12 months increased from 47% to 50%, while the percentage who say home prices will go down decreased from 18% to 14%. The share who think home prices will stay the same remained unchanged at 29%.

Only a handful of people thought mortgage rates would tick down in the next year, at 6%, a decrease from 8% the prior month. Mortgage rates are officially out of the 2% range homebuyers were taking advantage of in 2020, with the most recent report showing rates at 3.27% for a vanilla 30-year fixed mortgage.

Higher rates aside, consumers seem to be feeling better about the economy, as the percentage of respondents who say their household income is significantly higher than it was 12 months ago increased from 17% to 25%, while the percentage who say their household income is significantly lower decreased from 19% to 15%. The percentage who say their household income is about the same decreased from 61% to 56%.

Likewise, the percentage of respondents who are not concerned about losing their job in the next 12 months remained unchanged at 82%, while the percentage who say they are concerned also remained unchanged at 17%.

The post Home sellers are feeling good about 2021 appeared first on HousingWire.

Leave a Reply

Your email address will not be published. Required fields are marked *