WASHINGTON – Oct. 5, 2011 – According to the latest Realtors® Confidence Index survey, Realtors today are somewhat more confident about the existing home market than they were at this time last year. While there seems to be a general view that the market grew weaker recently, the current level of confidence is a bit better than it has been during much of the past three years.
The Realtors Confidence Index, based on a random survey of National Association of Realtors® (NAR) members, measures the strength of the current housing market and expectations about the future. Participants answer questions about the current and expected demand for homes, price trends and economic conditions.
Responses are assigned weights of 0, 50 or 100. A response of “strong” gets 100 points, while “moderate” is given 50 points, and “weak” is assigned 0 points. The questions capture Realtors’ feelings about the current real estate market and the effects of existing economic conditions and trends on the real estate business.
“Reports in the media about the state of the existing-home sales markets sometimes should carry scare-lines, rather than headlines … What they often miss, of course, is the story behind the numbers,” says Jed Smith, NAR managing director, quantitative research. “That story is that all real estate is local: some housing markets are actually performing well, some are performing poorly, and many are in-between. (However), median home prices have been moving up and down in a relatively narrow range in many markets; that shows a stabilization trend.”
The Realtors Confidence Index for single-family home sales reported in the August report decreased to 30.9 from July’s 31.3. The index was higher compared to last year’s conditions, however, when the index registered at 23.3. The townhouse index also dropped slightly to 17.0 in August from July’s 17.2. The condo index remained essentially the same at 14.1 from July’s 14.0. Both of townhouse index and condo indexes registered higher values than last year’s levels of 12.3 and 10.4, respectively.
Realtors say that the existing-home market continues to be challenging, and many respondents express some degree of frustration with previous and current levels of distressed properties, pricing and sales. There is a general level of agreement that the future outlook will strongly depend on continued economic recovery and job creation.
Jed Smith, NAR Managing Director, Quantitative Research, NAR