HousingIQ Survey Shows Kentucky Realtors Expect Sales to Rise, Possibly Lower Prices
According to the December 2021 edition of the Kentucky REALTORS® HousingIQ survey, the majority of Kentucky® real estate agents expect sales volume to increase over the next year, even as growth expectations for housing prices go down.
• 55% expect sales volume to increase, up two points from a year ago
• 27% anticipate an increase in foot traffic, down 14 points from a year ago
• 54% expect homes to stay on the market longer, up 27 points from a year ago
• 42% expect more price reduction from home sellers, up 20 points from a year ago
“Double-digit home price appreciation over the past 18 months is discouraging buyers. On top of that, rising, albeit historically low, mortgage rates are compounding affordability issues,” said Vidur Dhanda, author of the survey.
“Additionally, concerns about inflation and its potential impact on the overall economy are making buyers more cautious.”
In the latest issue of the Home Buying Sentiment Index, which tracks national consumer sentiment, Fannie Mae reported a record survey 26% of respondents said now was a good time to buy a home. home, compared to 56% a year ago.
According to the Mortgage Lender Sentiment Survey, consumer demand declined in the fourth quarter of 2021, and lenders expect demand to purchase mortgages to remain largely flat.
In the November 2021 survey, 36% of Kentucky® real estate agents said buyers were holding back due to concerns about the economy, with 82% saying buyers weren’t rushing to beat rising mortgage rates.
“Wage growth and continued economic recovery will support housing demand,” Dhanda said. “While low inventory and weak new construction will keep prices from falling.”
Based on monthly survey data, the HousingIQ/Kentucky REALTORS® Confidence Index provides a composite measure of expectations for the Kentucky real estate market over the next year.
The HousingIQ/Kentucky REALTORS® Confidence Index was virtually unchanged from last month at 45. A value of 100 corresponds to all respondents agreeing that market conditions will improve, while 50 corresponds to respondents who do not. anticipate no change in market conditions. The Price Expectations and Purchasing Power sub-indices were also unchanged from last month. The Homeowner Stress sub-index continued to improve to close the month at 69. The overall index is down two points from a year ago and price expectations are down three points. Compared to a year ago, purchasing power has jumped 14 points and owner stress has improved by 12 points.
The results indicate a market where demand is weakening and the lack of supply will prevent prices from falling. The survey results are available here.