A survey of 982 prospective buyers in 19 markets by tech-based brokerage Redfin shows an increasing conviction that home prices are on the rise, and a growing reluctance to get into multiple-offer situations.
"Many buyers who emerged from hibernation this spring eager to take advantage of low rates and near-bottom prices now seem to have become demoralized by the intense competition for a limited selection of homes for sale," the company said today in releasing the results of the survey, which was conducted Aug. 16-22.
Seven in 10 of those surveyed said they’d encountered competition on at least one offer, and 31 percent said they’d back off when faced with multiple-offer situations, up from 28 percent during the second quarter.
While 46 percent believe now is a good time to buy, that’s down from 56 percent during the first quarter. And 32 percent think now is a good time to sell, up from 13 percent during the first quarter — further evidence that would-be buyers think the market may be shifting against them, Redfin said.
While 61 percent of those surveyed by Redfin believe prices will increase, up from 32 percent during the first quarter, the percentage of would-be buyers who are worried about the economy also grew from 20 percent during the first quarter to 27 percent in the latest survey.
The National Association of Realtors said today that its index of pending home sales posted its 15th consecutive month of year-over-year gains in July, reaching the highest level in two years.
At 101.7, NAR’s Pending Home Sales Index was up from 99.3 in June and 90.5 a year ago. The index surged above the baseline reading of 100, established in 2001 — the first of five consecutive record years for existing-home sales, that also coincides with "a level that is historically healthy," NAR said.
The index is at its highest level since April 2010, which was shortly before the closing deadline for the federal homebuyer tax credit.
NAR Chief Economist Lawrence Yun warned that a limited supply of homes for sale is constraining sales — all regions except the West, which is experiencing "an acute inventory shortage," saw monthly increases in contract signings.
Redfin said that with mortgage rates still near historic lows, buyers working with the company’s agents are "willing to power through until they can find a home."