REALTORS® Report Slight Improvement in Most Markets in December 2014

REALTORS® reported that local markets broadly picked up for single-family homes in December 2014 compared to November 2014, although market activity was more modest compared to a year ago, according to the December 2014 REALTORS® Confidence Index Survey.

The REALTORS® Confidence Index-Current Conditions for single-family homes was 51 (49 in November 2014; 59 in December 2013). The indexes for townhomes and condominiums remained below 50. REALTORS® continued to report that financing for condominiums is difficult to obtain because of FHA financing eligibility regulations. An index above 50 indicates that the number of respondents who viewed their markets as “strong” outnumbered those who viewed them as “weak.”[1]

Rising employment, although accompanied by weak wage growth, and the decline in the 30-year fixed mortgage rate to slightly less than 4 percent since October 2014 likely accounted for the uptick in market activity.

Dec2014 RCI

[1]               An index of 50 delineates “moderate” conditions and indicates a balance of respondents having “weak”(index=0) and “strong” (index=100) expectations  or all respondents having moderate (=50) expectations. The index is calculated as a weighted average using the share of respondents for each index as weights. The index is not adjusted for seasonality effects.

Jed Smith, Managing Director, Quantitative Research

Jed Smith is Managing Director, Quantitative Research with the National Association of Realtors®. He has worked on real estate issues for the past 20 years, providing input on a variety of housing, commercial real estate, tax, and planning issues. Recently he has been involved in several international studies.

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