BrokerPulse

RealTrends Q32021 BrokerPulse sees brokers still optimistic about the market, wary of competition and wondering when inventory will rise.

2021 RealTrends Brokerage Compensation Report

For the study, RealTrends surveyed all the firms on the 2021 RealTrends 500 and Nation’s Best rankings, asking for annual compensation data for the 2020 calendar year.

Knock.com’s Sean Black on the transaction revolution

Real estate is on its third revolution, from the digital revolution of the early 2000s to the information revolution kicked off by Trulia and Zillow to today's transaction revolution.

Newsletter

The RealTrends BrokerSource and HousingWire OpenHouse newsletters deliver twice weekly information on trends, strategies, analysis, people, and news shaping the real estate industry.

Housing Reports: ‘Leftovers’ Fill Inventory, But Mortgage Rates Improve Outlook

Housing Reports: ‘Leftovers’ Fill Inventory, But Mortgage Rates Improve Outlook

Zillow analysts say that growing inventory is due to “leftovers” on market, while Realtor.com attributes its improved outlook for 2019 to lower-than-expected mortgage rates. New home sales are picking up the slack.

While the total pool of for-sale inventory has increased, the number of new listings on the housing market has fallen year-over-year in each of the past four months, according to the March Zillow® Real Estate Market Report. Zillow concludes that inventory growth is fueled by cooling demand, not increased number of sellers.

Overall inventory in the U.S. is 1.2 percent higher than in March 2018, but new listings fell 6.1 percent over the same period. And homes are staying on the market for longer – the median time on market increased four days in February from a year prior, the first such increase in four years and the largest since 2011.

“There is a narrative that inventory is growing, which favors buyers,” said Zillow Director of Economic Research Skylar Olsen. “But the how and why is important. There may be more homes available for sale over the course of the month, but that’s because more leftovers from previous months are sticking around. In truth, fewer homeowners are putting their homes on the market and buyer demand is falling back. Buyers won’t have as much competition this shopping season and can take more time finding the perfect match, if it’s out there.”

The Fed Effect

Meanwhile, Realtor.com has revised its forecast for 2019, based largely on a shift in the economic outlook, specifically, the Federal Reserve’s announcement that it didn’t expect to increase interest rates further this year.

Lower-than-expected mortgage rates should fuel higher home price growth of near 3 percent and stronger homes sales, realtor.com concludes.

“The 2019 housing market is different than what we predicted in fall 2018, primarily due to an unexpected drop in mortgage rates in January 2019,” said Danielle Hale, realtor.com®‘s chief economist. “We believe 2019 will be characterized by lower, but still increasing mortgage rates that will buoy home prices and sales by boosting buyers’ purchasing power beyond what we initially projected. This will create a slightly hotter, but still cooling housing market relative to the initial forecast five months ago.”

New Home Sales

Lower interest rates are also credited with boosting new homes sales to their highest pace since November 2017. Sales of newly built, single-family homes rose to a seasonally adjusted annual rate of 692,000 units in March after a slightly revised February report, according to data from the Department of Housing and Urban Development and the Census Bureau.

“These numbers indicate that builders who can produce housing at affordable price points will experience sales growth,” said Greg Ugalde, chairman of the National Association of Home Builders and a home builder and developer from Torrington, Conn. “However, builders are still dealing with a shortage of construction workers and buildable lots, which limits housing affordability.”

“We saw a large gain at lower price points where demand is strong. In March 2019, 50 percent of new home sales were priced below $300,000, compared to 39 percent in March 2018,” said NAHB Chief Economist Robert Dietz. “These are the price points that are attractive for renters seeking to become homeowners.”

Most Popular Articles

Where is the housing market headed?

Rising incomes, low interest rates and all other factors, including the balance between families looking for housing and the availability of housing, point towards a continuation of the strong housing market of the last 15 to 18 months.

Oct 18, 2021 By

Latest Articles

DOJ needs to honor agreement with NAR

NAR President Charlie Oppler writes: You should be able to count on the DOJ to honor an agreement. And yet, in a complete breach of commitment and legal precedent, the DOJ backed out of an agreement with the National Association of Realtors (NAR) that would more explicitly state the spirit and intent of NAR’s Code of Ethics and MLS guidelines in some key areas.

Oct 22, 2021 By