Home buyers think that seller’s markets are the mother of all

In real estate, it’s generally either a buyer’s or seller’s market. Since the industry reopened in mid-2020, it has become the mother of all seller markets.

And homebuyers think they’re going to go up and it’s not worth even trying.

According to a new poll by Fannie Mae, the federally backed mortgage company, only 25% of homebuyers think it’s a good time to buy a home, while 69% say it’s a good time to sell.

The monthly and quarterly survey, which interviewed nearly 1,000 people by phone over a three-week period in January, showed home-buying optimism was at its lowest since May 2020, but that was before the lockdown was lifted and no one knew. In which direction the market is going.

The US housing market is currently a nightmare for buyers. Demand for new homes is extremely high, but the inventory of available new homes is very low. They are being sold 10 days faster than a year ago and are being snapped up faster.

This unfortunate combination of circumstances has led to some pretty wild stories on the housing front, e.g Two-thirds of buyers who bid on a house they have never seenOr one in four home seekers willing to spend up to $100,000 over budget on their dream home.

No one feels it more than young people. A lack of affordable housing for middle-income earners and intense competition is taking a toll on the youth demographic. Millennials now entering the so-called prime mortgage age group are finding themselves ruthlessly cost-effective in a market with few affordable options in the first place.

A Fannie Mae poll indicates that young people surveyed are 40% more certain than the general survey audience that now is a good time to avoid home ownership, compared to just 15% of respondents aged 18 to 34 who think it’s a good time to buy.

Doug Duncan, Fannie Mae’s senior vice president and chief economist, said: “Younger consumers — more than any other group — expect home prices to rise more. Their optimism about their personal financial situation decreased during the month.

Respondents to the poll were more confident than in previous surveys that home prices will rise next year. Despite last week’s surprisingly strong January jobs report, people were more concerned about job stability than past results. Concerns over high mortgage rates were a big factor behind the pessimistic outlook on the housing market last month.

Real estate conditions today are all the ingredients needed for the perfect seller’s market cocktail. Rampant competition, rising prices, and the rapid turnover of homes for sale mean the market is biased toward buyers rather than sellers. As long as the demand for new homes exceeds the available supply, prospective home buyers may be more interested in maintaining this market.

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