Approximately 33 percent of respondents reported cash sales in January . About 13 percent of reported sales made by a first-time buyer were cash sales compared to about 50 to 70 percent for investors and international buyers. See the January REALTORS® Confidence Index Survey report for more information.
 The RCI Survey asks about the most recent sale for the month.
The qualified mortgage (QM) rule was implemented in January of 2014. It is the first of two rules that came from the Dodd–Frank Wall Street Reform and Consumer Protection Act that will impact the housing market. This law is intended to protect consumers by strengthening underwriting standards, but some have argued that the rules will raise costs and reduce access for consumers. To gain insight on the impact of the new law, NAR Research surveyed a sample of lenders with questions about the impact of the lending on their business and how the rule could in turn impact consumers.
When asked about the extent of the QM rule’s impact, 55% of survey respondents indicated that the QM rule would affect 2.6% to 20% of their originations. However, 20% of originators surveyed indicated that the changes and heightened underwriting in general would impact nearly all of their production.
What does this change mean for REALTOR®s and consumers? Consumers should expect to have to document their income, employment and resources. If your client has a high debt-to-income ratio, the FHA as well as Fannie Mae and Freddie Mac will be more lenient than private financers. However, if your client falls into the other aspects of the non-QM space or even the rebuttable presumption portion of the QM space (e.g. high fees, subprime, interest only, etc.) your client might require help finding a specialty lender. Consider finding a few lenders who specialize in financing these special cases at affordable rates so that you can meet your client’s needs if the time comes. For the full survey, click here.
The January REALTORS® Confidence Indexes for current conditions indicate a modest pace of expansion compared to the heated recovery in 2012 through mid-2013. The extreme winter weather was reported to have negatively affected sales, particularly on the East Coast and in the Midwest. But across many states, a major factor reported by REALTORS® that is impeding sales was the low inventory of available properties. Another problem cited was tight access to credit; there are reports that the self-employed have a tough time obtaining mortgages. See the January REALTORS® Confidence Index Survey for more information.
The index for single family sales registered at 60 (59 in December). The index for townhouses/duplexes was at 44 (43 in December) while the index for condominiums was at 40 (37 in December). The indexes are at about their levels compared to the same month last year but are lower than their peak levels in mid-2013. An index of 50 marks “moderate” conditions .
With spring around the corner, the 6-month Outlook Index is reflecting the seasonal market optimism. The index for single family homes rose to 69 (66 in December). The index for townhouses hit 50 (48 in December) while the index for condominiums registered at 46 (44 in December).
 An index of 50 delineates “moderate” conditions and indicates a balance of respondents having “weak” (index=0) and “strong” (index=100) 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.