Information is knowledge. Whether you’re trying to discover the ins and outs of your favorite college football team, or see where the latest housing trends are going, taking a deep dive into the data will help you get a better understanding of where we were, where we are, and where we’re heading.
At the National Association of Realtors’ (NAR) Fall conference in Orlando last week, I was reminded of a valuable tool that helps measure data from Realtors across the nation in an effort to see where the housing market is going.
It’s the Realtors Confidence Index.
But what is the Realtors Confidence Index? It is a key indicator of housing market strength based on a monthly survey sent to over 50,000 real estate practitioners. It gathers information on three topics: local real estate market conditions, characteristics of buyers and sellers, and issues affecting homeownership and real estate transactions. The report contains graphs and charts to depict trends in the industry. In short, Realtors can use this data to influence how they do business through discovering how long properties are typically on the market, if home prices are remaining constant or rising, and what type of buyers are accounting for home sales.
Dr. Lawrence Yun, Chief Economist for NAR, mentioned this study from October and had some interesting insights:
Six percent of realtors expect a year-over-year increase in buyer traffic in the next three months, down from seven percent in September 2022 and from 27 percent in October 2021.
Seven percent of respondents expect a year-over-year increase in seller traffic in the next three months, which is comparable to the seven percent in September 2022 and a decrease from the 20% in October 2021.
So while the market may be correcting right now, many Realtors are seeing signs of increased interest in homebuying in the next few months.
Yun also pointed out that with supply still limited relative to demand, the market is still moving at a fast pace, and 24 percent of homes sold above list price, down from 28 percent a month ago and 42 percent a year ago. 64 percent of respondents reported properties sold in less than one month, which was down from 70 percent a month ago and 82 percent in October 2021.
Homes listed in the multiple listing service received an average of 2.4 offers, nearly flat from September 2022 when it was 2.5 and down from 3.7 in October 2021. Also, due to the lack of housing inventory, the pace of the market, and the use of technology, seven percent of buyers purchased a home based only on a virtual tour, showing, or open house without physically seeing the home. This is nearly unchanged from one month and one year ago.
It’s important to note that the RCI Survey gathers information from realtors about local market conditions based on their client interactions and the characteristics of their most recent sales for the month.
So the market is shifting. But it’s clear that the market is not stopping, as some people have feared. And if mortgage interest rates continue to drop, many folks are expected to jump back into the housing market after being put on hold for a short while.
Navigating this data takes an expert, which is why you should consult a Realtor® for all your purchasing needs. Realtors work tirelessly with clients everyday to make sure that they’re getting the most out of their most valuable investment. That’s Who We R.