Current market conditions, including high demand, rising home values, and fast-selling properties, make homeowners believe that this is a good time to sell.
Owners and renters who are looking to buy are a little less confident, according to Zillow. Using data from the semi-annual Zillow Housing Confidence Index, the site found that homeowner confidence rose one point to 71.3 in July, while renter confidence fell 0.3 percent to 61.2 that month.
Zillow analyzed 20 metros and found the renter-homeowner gap was widest in San Francisco, where 73 percent of homeowners say it’s a good time to sell, and 13 percent of renters believe it’s a good time to buy.
Even though the majority of homeowners are confident and believe now is a good time to sell, they’re holding off because they expect home values to continue to appreciate and want to ride the wave. They also don’t want to turn around and become buyers in a competitive market. On the flip side, renters aren’t nearly as confident as homeowners – they’re discouraged by the shrinking number of homes for sale and rapidly rising prices. As housing gets more expensive, these trends are not sustainable in the long-run, especially once mortgage rates start to rise. We’re likely to start seeing weakening confidence and/or faltering home value appreciation if these imbalances persist.