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Income Has Risen But Will It Lead To Home Sales?

A rising number of Americans surveyed for Fannie Mae’s monthly Home Purchase Sentiment Index say their income is higher than it was last year at this time. But has more money made them more likely to buy or sell a house? Well, according to February’s survey results, it’s hard to say. That’s because, after an increase in January, housing sentiment fell in February – with respondents expressing less confidence in a number of categories. In fact, the number of participants who said it’s a good time to buy a house was down, as was the percentage of participants who said it was a good time to sell. But if January saw increases in housing confidence, why the drop in February? Doug Duncan, Fannie Mae’s senior vice president and chief economist, says some of the uncertainty has to do with changing economic headlines. “Volatility in consumer housing sentiment continued in February, with the new tax law beginning to impact respondents’ take-home pay and the stock market creating negative headlines due to early-month turbulence,” Duncan said. In short, people have more money but they’re still a bit unsure of what lies ahead for the market. More here.

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The Top Sacrifices Millennial Buyers Say They’ll Make

Buying a house is a major financial transaction and, for most Americans, the largest one they’ll ever undertake. So pulling the necessary resources together to be able to afford the upfront costs, in addition to the ongoing obligations, maintenance, and upkeep can be difficult. Especially for first-time home buyers who don’t have the benefit of being able to sell a home to help fund their down payment. For this reason, many millennials who aspire to homeownership have decided it’s worth making a few sacrifices in order to help save money to buy a house. In fact, according to a recent survey from ValueInsured, there are some common sacrifices young Americans say they are willing to make in order to buy their first home. For example, nearly 60 percent of respondents said they would cut down or give up eating out – which made giving up restaurants the most popular sacrifice among survey participants. Other common sacrifices included taking a second job, not going on vacations, moving back in with their parents, and giving up shopping for clothes. More here.

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Nearly 60% Of Homeowners Plan Home Improvements

If you’re a homeowner, you know the to-do list is never ending. And, if you’re a buyer, you’ll know soon enough. That’s because, owning a home means maintaining a home. Proof of that can be seen in the fifth annual LightStream Home Improvement Survey. According to the results, 58 percent of surveyed homeowners say they’re planning to spend money on home improvement projects in 2018. And the number who said they plan on spending $35,000 or more has doubled from last year. But though there are more homeowners planning projects this year, the list of projects hasn’t changed all that much. Once again, outdoor upgrades remain the most popular, with decks, patios, and landscape projects topping the list. Kitchen and bathroom remodels, of course, also rank high, coming second and third on Americans’ home improvement, to-do list. So how are these homeowners planning on paying for all these upgrades and renovations? Well, the vast majority said they were paying for their projects out of savings. However, another way homeowners are saving on their home improvement bills is by doing, at least, some of the work themselves. More here

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Conditions Are Ripe For Spring Home Buyers

As the spring home buying season approaches, there are many moving parts analysts and experts look at to determine how home buyers and sellers might fare. Economic growth, the job market, interest rates, home prices, buyer demand, and inventory are just some of the factors that will determine how many hopeful home buyers find new homes this year. According to one outlook – from Fannie Mae’s Economic and Strategic Research Group – conditions are good for buyers, except for one specific, long-standing obstacle. “We don’t expect rates to play much of a role in total home sales, especially with anticipated stronger disposable household income growth,” Doug Duncan, Fannie Mae’s chief economist, said. “The ongoing inventory shortages should constrain sales despite otherwise ripe home buying conditions.” In other words, though mortgage rates may inch upward this year, so will household income. That leaves inventory as the main challenge to buyers this spring. With fewer homes for sale, there will be more competition and pressure on prices. More here.

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Number Of Showings Up Over Last Year

If you want an accurate read of how many interested home buyers are active in the housing market right now, you can’t do much better than a measure of appointments to view available homes. The number of showings potential buyers set up provides a pretty good snapshot of how much demand there is from qualified buyers. And, according to ShowingTime’s Showing Index – which tracks appointments to view homes – there’s a lot. “Showing activity continued to increase overall as we moved into 2018, with several markets outpacing the National Index,” ShowingTime’s chief analytics officer, Danii Cherkasskiy, said. “Some areas in the South region saw relative increases in showing activity in January, compensating for the slowdowns experienced in the fourth quarter due to Hurricane Irma.” Overall, showings were up 5.2 percent year-over-year in January – a good indication that buyer demand will remain elevated this year. Among the reasons prospective home buyers are active right now, still-low mortgage rates, a stronger job market, and growing economic stability top the list. More here.

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Owners Of Smaller Homes Seeing The Biggest Gains

Smaller, affordable homes are in high demand these days. With a growing number of first-time home buyers entering the market and a lower-than-normal number of entry-level homes available for sale, there is a lot of competition for good, affordable homes among younger buyers. Because of this, owners of smaller homes are seeing big equity gains when compared to homeowners at the higher end of the market. Zillow senior economist, Aaron Terrazas, says there are a couple of reasons for this. “When the housing market crashed, owners of the least valuable homes were especially hard hit, and lost more home value than homeowners at the upper end of the market,” Terrazas says. “Since then, though, demand for less expensive, entry-level homes has built steadily, causing prices to grow rapidly. As a result, these homeowners have been able to build wealth at a faster pace than owners of more expensive homes.” In fact, according to recent research, people who own starter homes have seen their equity grow by nearly 45 percent over the past five years, while high-end homeowners saw gains closer to 27 percent. More here.