The National Association of Realtors’ (NAR) released its latest Confidence Index yesterday, showing a distinct rise in year-over-year confidence in December among the more than 3,000 agents surveyed.
A measure of the strength of the current housing market and expectations about the future, the survey’s questions are designed to capture the effects of existing economic conditions and trends on the real estate business.
The index for single-family home sales was 31.6, an increase from 30.4 in November and 24.5 in December 2010; the indexes for townhouses and condos posted similar year-over-year increases, with townhouses rising from 12.6 to 18.5 and condos from 10.3 to 14.3.
NAR also divided the index by region, with the Northeast at 25.8, the Midwest at 29.3, the South at 33.3 and the West leading the way with 35.
Along with the Confidence Index, NAR did include other numerous statistics in its report. For instance, 32 percent of home sales from the surveyed agents were distressed properties, and of those, 28 percent were in below average condition. 31 percent of home sales were financed with cash, and of the remaining 69 percent of sales that received mortgages, 30 percent had down payments of 3 to 6 percent while 36 percent ran from 20 to 99 percent of the home’s sale price, a rather stark reminder of how lending is often divided between prime loans and FHA financing.
Perhaps most valuably, though, NAR included a number of comments from respondents on different aspects of the housing market.
For instance, on the current economic conditions, here is what this agent had to say: “Sellers and Buyers need to understand this is the NEW economy. Price are what they are, sellers are not going to sell their house for the price they were going to get 6-8 years ago. This economy has corrected itself. Buyers need to realize financing will never be at these rates again. Sellers need to understand when rates go up to 6-8% again the price of their house may drop again. Again, this is the NEW economy; deal with it and prosper.”
Another linked housing with the job market: “The biggest problem I see is that the market will not change for the better until there are more jobs available and/or more stability in the job market.”