Americans' optimism about the housing market slips, reaches 10-year low

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BySamantha Kummerer WTVD logo
Tuesday, August 16, 2022
Consumers' sentiment towards housing market slips
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The index shows sentiment is down 13 points from last summer, the lowest level since 2011.

RALEIGH, N.C. (WTVD) -- Sentiment toward the national housing market is at the lowest in a decade, according to the latest Fannie Mae Home Purchase Sentiment Index.

The index shows sentiment is down 13 points from last summer, the lowest level since 2011.

The survey found nationwide only 17% of consumers thought it was a good time to buy a home. On the selling side, optimism isn't much better. The percentage of consumers who believe it is a good time to sell has dropped by 10% between May and July.

Mortgage rates remain a top reason behind the poor sentiment on either side of the market.

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Locally, real estate experts said sentiment is also lower across the Triangle but the trends are not as intense.

"There are some areas that were either were overpriced or don't have the jobs, we don't have that," explained real estate broker Maya Galletta. "With the number of people moving here, the low inventory, we should see some stabilization. And maybe prices aren't going to be rising as quickly, but it's kind of a new normal."

The median price for homes is around $420,000, according to the Triangle MLS.

The median price of real estate in Wake County has increased by $60,000 since the start of the year, according to the county.

"I think one thing I'm seeing is higher priced homes are coming on the market, which is increasing a month's supply of inventory, but it's not necessarily increasing the amount of affordable homes in the market," said Thomas Babb, the director of communications for Triangle MLS. "I guess you could say that's the alarming element."

Supply is up slightly from last year, but it is still only a fourth or fifth of where it should be.

"We're back up to about a month and a half. So it's -- we're starting to see a few more houses come on the market and last a little bit longer, but it's still not a healthy market. A healthy market would be somewhere between four and seven months of inventory," Babb explained.

While supply is slowly increasing, they also aren't selling quite as fast.

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Babb said the average house is on the market for around 12 days, which is around three days higher than this time last year.

"I'm assuming from what the data is saying that with the higher interest rates and the lack of affordable housing, it's going to cause the days on market to tick up a little bit," he said.

Galletta said, she and her clients have noticed a difference in those extra days.

"It's a great time to buy because you have choices. We haven't had choices. Compared to last summer, where there was none now you can go out and go look at five or six houses and actually make an offer and not feel like you have to make that offer yesterday," she said.

She said the clients she works with have time to breathe a little bit now and get some more personalized attention and closer inspection options. She recommends that buyers who do have the means take advantage of the current market.

"If they're waiting for the rates to go down, it is unlikely," she said. "Right now, we're pretty stable. So if they do their research now and reach out to the right people, they've got inventory, they have options."

Babb agreed and said the current situation shouldn't dissuade buyers.

"It's not necessarily an unhealthy market to buy into. It's kind of like playing the stock market. If you never buy anything, you're never going to see an uptick in collateral. If you remain a renter, you're always going to be putting your money into a rental market and that's not going to be helping you," Babb said.