Yet another survey finds it’s not current market conditions but future expectations that have consumers holding off on buying a house.
Sixty-three percent of Americans believe now is a good time to buy a home, according to the National Association of Realtors (NAR) third quarter HOME survey. Although that figure reflects strong optimism, it is down from 75% of respondents that indicated purchasing conditions were favorable during the 2018 third quarter when mortgage interest rates were higher.
“Mortgage rates are at historically low levels, so I see no sign of the optimism about home buying fading,” says Lawrence Yun, NAR’s chief economist. “However, the fact that slightly fewer are expressing strong intensity compared to recent prior quarters is implying some would-be buyers have concerns about the direction of the economy.”
That optimism slides as survey respondents’ income level declines and is in line with conclusions from a recent report by real estate brokerage company Redfin about the likelihood of another recession occurring.
“Homeowners who are laid off may not be able to continue covering their monthly mortgage payment and may be forced to sell their homes, said Daryl Fairweather, Redfin chief economist. “And would-be homebuyers won’t feel so confident about making a big purchase when they don’t feel confident about their job security or their financial wellbeing.”