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REALTORS® Confidence Index July 2012

REALTORS® Confidence Index July 2012

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Published by: REALTORS® on Aug 10, 2012
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05/13/2014

 
1
REALTORS® CONFIDENCE INDEX
Report and Market Outlook
July 2012 Edition
Based on Data Collected July 23
 –
July 30, 2012
NAR Building, Washington,D.C., looking towards the Capitol 
NATIONAL ASSOCIATION OF REALTORS®
Research Department 
Lawrence Yun, Senior Vice President and Chief Economist
 
2
Table of Contents
Summary
 – 
Real Estate Markets Continue to Recover..
………………………………………
...
…….
......3REALTORS
® Confidence Index: Current Conditions……………………………………………
.
….……
.
…3
 REALTORS® Confidence Index: Six Month
Outlook……………………………………………
.
..
………
4
Section 1: Market Conditions
 Single Family Properties..
……………………………………………………
.
…………………………...
.
..6Townhouse Properties
……………...…………………………….………………….…………………
..
……..
7Condo Properties
…………………….………………………………………………………...…………..
.......7Eighty-five Percent Expect Constant or Higher Residential Prices in the Next 12
Months………………..
.
8Buyer Traffic Continues to Outpace Seller Traffic
……
.
…………………………………………………….
...9Thirty-Three Percent of Houses Sold in One
Month ………..…………………...……………
.
...................9Distressed Sales Continued to Decline in Market
Share……………………………………………………
...10Distressed Real Estate
 —Below Market Prices……………………………………………………
..
..
..11
Property Condition Affects Selling Price of Distressed Properties…………………………………
.
……
......11
Section 2: Buyer and Seller Characteristics
Cash Sales: 27
Percent of Residential Sales……………………………………………………
....
…….…
....13First Time Buyers: 34 Percent of Residential Buyers
………………………………………………
..
........13Relocation
Buyers: 15 Percent of Residential Market.…..…………………………………………
..
………
..14Residential Sales to Investors: 16
Percent of Residential Market……………………………
 
..
………
...14Second Home Purchases: 11 Percent of Residential Market.
…………………………………………
............15
Mortgage Down Payments…………………………………………………………………………
..
……….
.16REALTORS
® Continue to Report Rising Rents for Residential Properties……………
.
…………
..
……...
..16International Transactions : Two Percent of Residential
Market……………………………..……
..
……
.
.17
Section 3: Current Issues
 Appraisals
 —A Continuing Problem…………………………………………………………
.
……………
....18Tight Credit Conditions
………………………………………………………………………
.
……….……
..18
Section 4: Recent NAR
®
Articles
Home Price Update
 – 
 
Lawrence Yun…………………………………..………
..
………
.
……………
......
.20Low Rates, But Who Can Get Them?
 —Ken Fears…………………………………………………………...
22REALTORS® Comments
 —Jed Smith…………………………………………………………………..…...
24RRALTORS® Commercial Markets Maintain Momentum in Second Quarter 2012
 —George Ratiu………
.25
 
3
SUMMARYReal Estate Markets Continue to Recover
Gay Cororaton and Jed Smith
The
 REALTORS® Confidence Index (RCI)
report provides monthly informationpertaining to expectations about overall market conditions, buyer/seller traffic, price, buyerprofiles, and issues affecting real estate. The July edition is based on responses of over 3,400REALTORS® to a survey conducted during June 25
 – 
July 30, 2012.
1
All real estate is local:conditions in specific markets may vary from the overall national trends presented in this report.The REALTORS® current confidence index declined slightly in July even as the level of existing home sales and prices showed an ongoing recovery.
Based on respondents’ comments,
several factors appear to be constraining the recovery. REALTORS® reported that buyerscontinued to face tight mortgage standards, a stringent and slow bank approval process, lowappraisal values, low inventory relative to demand, and multi-bidding situations in some cases.Sellers were reported as reluctant to list
at the “new normal” level of prices
, and in addition, notenough bank-owned inventory is being released to relieve the tight supply. There continues tobe a concern that a big release of shadow inventory could depress prices in the future.
 
The Current Conditions Confidence Index declined in July for all types of residentialproperty after a surge earlier in the year. Still, the RCI-SF (single family) current index is at54.0 which means that expectations are slightly above moderate (an index=50 indicatesmoderate expectations). The current confidence indexes for for the townhouse andcondominium markets remain below moderate.
1
There were 3,409 respondents to the July survey, which was sent to about 50,000 REALTORS
®
.
0.010.020.030.040.050.060.070.0
   F   e    b   0   8   M   a   y   0   8   A   u   g   0   8   N   o   v   0   8   F   e    b   0   9   M   a   y   0   9   A   u   g   0   9   N   o   v   0   9   F   e    b   1   0   M   a   y   1   0   A   u   g   1   0   N   o   v   1   0   F   e    b   1   1   M   a   y   1   1   A   u   g   1   1   N   o   v   1   1   F   e    b   1   2   M   a   y   1   2
July 2012 REALTORS
®
Confidence IndexCurrent Conditions
SFTHCondo
SF: 54 TH: 35 Condo 29

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