More US homebuyers confident about rising home prices, less concerned about economy

SEATTLE, Dec. 17, 2012 /PRNewswire/ — Redfin ( www.redfin.com ), a technology-powered real estate broker, today released its latest survey of homebuyers. Data was collected from November 30 to December 2, capturing sentiment of 1,084 active homebuyers across 18 U.S. markets who had toured a home with a Redfin agent since August 14. The Redfin Real-Time Homebuyer Survey is a companion to the quarterly Home-Seller Survey and Agent Survey.

Results Snapshot:

  • 71% of homebuyers believe that home prices will increase in their neighborhood in the next year, up from 61% last quarter and more than double the 34% who expected rising prices in our first quarter survey;
  • 33% listed rising home prices as a major concern, up from 23% last quarter;
  • 22% of respondents said they were concerned about a weak economy, down from 27% in the third quarter;
  • 57% cited low interest rates as a reason to buy now, down seven percentage points from last quarter and sixteen percentage points from the first quarter, but still the most common motivator for buying now;
  • 59% indicated that low inventory was their top concern with buying a home, consistent with last quarter's rate;
  • 37% of respondents indicated they are first-time homebuyers, down from 48% last quarter; and
  • 5% of respondents are concerned about the Fiscal Cliff and possible changes to the Mortgage Interest Deduction.

Over the last year, the most salient trends in homebuyer sentiment have been an increasing faith in the fact that home prices are on the rise and subsequently, a growing concern about those very rising prices.  Low inventory has remained a constant source of frustration among homebuyers for nearly all of 2012. Meanwhile, the welfare of the economy has become a less important factor in the home-buying process. These sentiments point toward an increasingly confident pool of American homebuyers. As a result, Redfin expects the 2013 home-buying season to kick off early in January with very strong demand, which, paired with low inventory, will cause prices to continue to rise steadily into spring.

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