2017 08 Realtors Confidence Index 09 20 2017 PDF

August 2017
REALTORS CONFIDENCE INDEX SURVEY
Research Division
NATIONAL ASSOCIATION of REALTORS
August 2017 REALTORS CONFIDENCE INDEX SURVEY

August 2017 Market Conditions and
Outlook
Amid sustained job creation and sustained historically low mortgage
rates, REALTORS reported strong homebuying demand in August 2017.
Properties continued to sell at a brisk pace, and homebuyers faced higher
prices as supply remained low relative to demand.
Demand from first-time buyers continued to increase at a modest pace.
More REALTORS expect strong than weak market conditions in the
next six months compared to current market conditions.
Amid tight supply, most respondents expect constant or increasing prices
in the next 12 months.
REALTORS reported tight inventory as the key issue affecting sales.

August 2017 Highlights
August 2017 REALTORS Confidence Index Survey Highlights
Aug-17 Jul-17 Aug-16

RCI Buyer Traffic Index 64 69 61
RCI Seller Traffic Index 47 49 44
RCI Current Conditions: Single-Family Sales 69 75 69
RCI Six-Month Outlook: Single-Family Sales 67 71 66
First-Time Home Buyers, as Percent of Sales 31 33 31
Cash Sales, as Percent of Sales 20 19 22
Distressed Sales, as Percent of Sales 4 5 5
Sales for Non-Primary Residence Use, as Percent of Sales** 15 13 12
Median Days on Market 30 30 36
Sold at Original List Price or Premium, as Percent of Sales 39 36 34
Median Expected Price Growth in Next 12 Months (%) 3.0 2.7 2.6
*This is a diffusion index. An index greater than 50 indicates strong conditions and an index less than 50 indicates weak conditions.
**Non-primary residence use refers to the primary use of the property for either vacation or residential rental.

I. Market Conditions and Expectations

Market Conditions Remained Strong
The REALTORS Confidence REALTORS Confidence IndexCurrent Conditions

IndexCurrent Conditions
indices for detached
single-family, townhome,
90
and condominium 80
69
properties were above 50, 70
indicating more 60 56
respondents reported 50 53
40
strong than weak
30
market conditions in 20
August 2017 compared to 10
the same month last year. 0
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Single-family Townhome Condominium

Buyer Traffic Strong, Seller Traffic Weak
The REALTORS Buyer

Traffic Index (64) REALTORS Buyer and Seller Traffic Indices
indicates that buyer
demand is stronger
compared to 80
conditions one year 70

64
ago (69 in July 2017; 61 60
in August 2016).
50
The REALTORS Seller 47
40
Traffic Index (47)
indicates supply 30
remained generally 20
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tight, although slightly
better compared to
conditions one year
ago (49 in July 2017; 44
in August 2016). Buyer Traffic Index Seller Traffic Index

Homebuying Demand Stood Strong
Compared to
conditions in the
same month last year,
buyer traffic
conditions were
stable (no change in
conditions) to very
strong, except in
Delaware where
conditions were
weak.
*For graphical purposes, index values less than or equal to 25 are labeled Very Weak, values of 25.01 to
45 are labeled Weak, values of 45.01 to 55 are labeled Stable, values of 55.01 to 75 are labeled
Strong, and values greater than 75 are labeled Very Strong.

Inventory Remained Tight
Compared to
conditions in the same
month last year, seller
conditions were
strong only in nine
states and the District
of Columbia.
*For graphical purposes, index values less than or equal to 25 are labeled Very Weak, values of
25.01 to 45 are labeled Weak, values of 45.01 to 55 are labeled Stable, values of 55.01 to 75
are labeled Strong, and values greater than 75 are labeled Very Strong.

Days on Market Continued To Trend Down
Median Days on Market of Sales Reported by

Amid tight supply, REALTOR Respondents
properties were typically
on the market for 30 120
days (30 days in July

100
2017; 36 days in August
2016). 80
Fifty percent of 60
properties were on the
market for less than one 40
month when sold, 30

20
compared to 46 percent
in the same month one 0
year ago.
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Properties Sold Quickly in Many States
Properties that sold in

JuneAugust 2017
were typically on the
market for less than
31 days in 29 states
and the District of
Columbia.

Home Prices Continued to Increase
Percentage Distribution of Price Change from a Year Ago

Amid tight supply, Reported by REALTOR Respondents
home prices
continued to increase
90%
in many areas. 80%
Ninety-one percent of 70% 71%

60%
respondents reported
50%
that home prices 40%
remained constant or 30%
rose in August 2017 20%
16%
compared to levels 10%
14%
0%
one year ago (91
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percent in July 2017;
88 percent in August
2016).
Higher Lower Unchanged

Properties Sold Above Listing Price
Percent of Properties Sold at Original Price or at Net

Because conditions are Premium from the Listing Price
competitive for buyers 45%
and supply is tight, offers

continued to be high 39%
40%
relative to asking price.
Thirty-nine percent of
properties in August 35%
2017 sold at or above

the original listing price 30%
(36 percent in July 2017;
34 percent in August
2016). 25%
20%
201212
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More Clients Took Home Tours
Average Number of Clients Taken on a Home Tour by Agent

On average, 6.0
REALTOR
respondents took 5.5
nearly five clients on a
home tour in August 5.0
2017, about the same 4.7
as the number of 4.5

clients one year ago.
The number of home 4.0
tours exhibits a
3.5
seasonal increase in
the spring and
3.0
summer months,
accounting for the
2.5
spike last month.
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Offers Per Client Held Steady
Average Number of Offers Written Per Client Taken on a

On average, REALTOR Home Tour*
respondents wrote
approximately two
3.0
offers per client they
2.8
took on a home tour, 2.6
about the same as the 2.4
2.2
number of offers written 2.2
one year ago. 2.0

1.8
1.6
1.4
1.2
1.0
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*Regardless of acceptance

Strong Markets Expected in Six Months
The REALTORS Confidence
IndexSixMonth Outlook REALTORS Confidence IndexSix-Month Outlook
Current Conditions indices
for detached single-family,
townhome, and 90
condominium properties 80
67
70
were above 50, indicating 60 56
more respondents 50
53
expected conditions to 40
strengthen rather than 30
weaken over the next six 20

10
months compared to
0
current conditions.
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Single-family Townhome Condominium

Home Prices Expected to Increase
REALTOR respondents
expected strong price
growth in Washington,
Nevada, Utah, and
Colorado, of more than
five percent in the next
12 months.
Respondents expected
prices to remain stable
or increase modestly in
states that are more
reliant on oil production
(e.g. Alaska, North
Dakota, Wyoming,
Oklahoma, Mississippi,
and West Virginia) and in
Connecticut and
Vermont.

II. Characteristics of Buyers and Sellers*
* Based on the respondents most recent sale for the month.

Share of First-time Homebuyers Remains
Modest
Of all buyers, First-time Buyers as Percent of Residential Market
31 percent were
first-time buyers
(33 percent in July 55%
2017; 31 percent in
50%
August 2016).
45%
Sustained job growth,
improving incomes, 40%
and the aging of the 35%

Millennial generation 31%
30%
are likely underpinning
the sustained, albeit 25%
modest, demand by 20%

first-time buyers.
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NARs 2016 Profile of Home Buyer and Sellers (HBS) reports that among primary residence home buyers, 35 percent were first-time home buyers, up
from 32 percent in 2015. The HBS surveys primary residence home buyers, while the monthly RCI Survey surveys REALTORS and captures purchases
for investment purposes and vacation/second homes. The U.S. Census Bureau defines the Millennial generation as those born in 19822000.

Increased Sales: Buyers 34 Years and
Younger
Age Distribution of Buyers for Sales Reported by
REALTOR Respondents
Home sales among
buyers 34 years and 60%
younger have been on 50% 48%

an uptrend. This age
40%
group accounted for
30 percent of sales, up 30% 30%
from 26 percent in July 20% 22%
2013 when the RCI

10%
Survey first asked the
question.* 0%
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Age 34 and under Age 35 to 55 Age 56 and over
*NARs 2016 Profile of Home Buyer and Sellers (HBS) reports that among primary residence home buyers, 28 percent were 18-34 years old.
The HBS surveys primary residence home buyers, while the monthly RCI Survey surveys REALTORS and captures purchases for investment
purposes and vacation/second homes.

Renters: Still on the Sidelines
Living Status of Homebuyers at Time of Home Purchase
Homebuyers who
were renting prior to
60%
their home purchase
accounted for 50%
40%
39 percent of sales 40%
39%
(40 percent in July 30%
2017; 44 percent in 20%
August 2016). 10%

14%
7%
Homebuyers who lived 0%
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with their parents,
relatives, or friends
prior to their home
purchase made up Rented an apartment or house Lived in a property that they owned
14 percent of sales.
Lived with parents, relatives, or friends Other
NARs 2016 Profile of Home Buyer and Sellers (HBS) reports that among primary residence home buyers, 41 percent rented an apartment or house prior to
their home purchase. The HBS surveys primary residence home buyers, while the monthly RCI Survey surveys REALTORS and captures purchases for investment
purposes and vacation/second homes.

Home Inspection Topped Buyer
Contingency List
Contract Settlement Contingencies as a Percent of
Ninety-one percent of Respondents*
agents who worked
with buyers reported
contract contingencies 19%
for their most recent 16% 15%
sale in August 2017.

7%
Passing a home 3% 2% 1% 1%
inspection, obtaining
financing, and getting an
acceptable appraisal
valuation were the
most common buyer
contingencies reported
in August 2017.
*Respondents refer to buyers' agents. Multiple responses are allowed.

Distressed Property Sales Have Declined
Distressed Sales as Percent of Residential Sales

Distressed sales
accounted for four
percent of sales. 60%
With rising home 50%
values, improved 40%

economic conditions,
30%
and fewer homes
going into foreclosure, 20%
the share of sales of 1%
10%
distressed properties 3%
has declined from the 0%
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peak of 49 percent in
March 2009.
Foreclosed Short sale

Cash Sales Have Declined
Twenty percent of sales Cash Sales as Percent of Residential Sales

were all-cash (19
percent in July 2017; 22
40%
percent in August 2016).
As sales to investors 35%
and distressed 30%

properties have fallen,
the share of cash sales 25%
has declined compared 20%

20%
to 2009-2014 levels.
15%
10%
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Most First-time Buyers Put Down Less
than 20 Percent Downpayment
Percent of Buyers Who Put Down Less Than 20 Percent for
Compared to all buyers, Downpayment
a higher share of first-
time buyers obtain a
85%
loan with a lower
80%
downpayment.
75%
Seventy-one percent of 70%
71%
first-time buyers in 65%
August 2017 put down 60%
less than 20 percent
55%
downpayment, 53%
50%
compared to 53 percent
45%
among all buyers.
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First-time Buyers All Buyers

Sellers Offered Few Incentives
Seller Incentives Offered

Twenty percent of
sellers reported
offering incentives. 80%
Helping cover the

closing costs, providing
warranties,
undertaking
remodeling, providing
appliances, and paying
condo fees were the
incentives offered by 9% 8%
sellers on sales that 3% 1% 1%
closed in August 2017. No incentive Closing Cost Warranty Remodelling Appliances Condo Fees

Most Sellers Used the Property as Primary
Residence
Seller's Use of Property
Most sellers used the
property as a primary 100% 2%
residence. 90%
4%
19%
Nineteen percent of 80%
sellers who sold a 70% 5%
property in July 2017 60%
used the property for 50%
40%
investment purpose, as 69%
30%
a rental property (16
20%
percent in July 2017;19
10%
percent in August 2016). 0%
Primary Vacation Investment Property (Rental) Other* Dont Know
July 2017 REALTORS CONFIDENCE INDEX SURVEY

Most Sellers Vacated Property After
Contract Was Accepted
When Seller Vacated Property
Most sellers vacated the
property between 100%
6% 6% 5% 5% 4%
2%
contract acceptance and 90% 3% 3%
5% 6%
3%
1%
7%
Don't Know
8% 7% 6%
closing. 80% 7%
7% 11% 6% 6%
More than 6 Months Before Listing
8% 5%
Nineteen percent of 70% 8% 6%
3-6 Months Before Listing
sellers vacated the 60%
property after closing 50%

2 to 3 Months Before Listing
58%
under leaseback terms. 40%
49% 50% 48% 52%
Within 1 Month Before Listing
30%
Between Listing and Contract
Acceptance
20%
Between Contract Acceptance and
10% 18% 20% 21% 18% 19% Closing
After Closing (Leaseback)
0%
201704 201705 201706 201707 201708

III. Issues Affecting Buyers and Sellers
* Based on the respondents most recent sale for the month.

settled on time,
25 percent had a
were terminated.
of contracts were
and three percent

delayed settlement,
seventy-two percent
In JuneAugust 2017,
10%
20%
30%
40%
50%
60%
70%
80%
0%
201501-201503
201502-201504
201503-201505
201504-201506
201505-201507
201506-201508

201507-201509
201508-201510
201509-201511
201510-201512
201511-201601
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201601-201603
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Contract was terminated
201603-201605
201604-201606
Contract was settled on time
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201607-201609
Contract Settlement
201608-201610
Most Contracts Settled on Time
201609-201611
201610-201612
201611-201701
201612-201702
Contract was delayed but eventually went into settlement
201701-201703
201702-201704
201703-201705
201704-201706
201705-201707
201706-201708
3%
25%
72%
Financing and Appraisals Topped List of
Delays
Issues related to Problems Encountered for Contracts That Were Delayed in

JuneAugust 2017*
obtaining financing and
appraisal were the most Issues Related to Obtaining Financing 26%
common causes of
Appraisal Issues 25%
contract settlement
delays in JuneAugust Home inspection/environmental issues 13%
2017. Titling/deed issues 11%
Contingencies stated in the contract 8%
No problems encountered 6%
Issues in buy/sell distressed property 2%
Home/hazard/flood insurance issues 1%
Buyer lost job 0%
*Delayed contracts accounted for 25 percent of closed or terminated contracts during this period.

Mortgage Rate Increases: Modest Impact
on Homeowner Decisions
A modest share of
respondents Percent of Respondents Who Reported They Had a Client Who
reported they had Decided Not to Move/Sell to Keep Current Mortgage Rate
16%
a client who
decided not to sell 14%
14% 14%
14% 13%
or move to keep 12% 12%
13% 13%
the existing 12%
mortgage rate. 10%

10%
The 30-year fixed
mortgage rate 8%
increased to above
four percent in the 6%
week of November
4%
24, 2016, but rates
have dropped to an 2%
average of 3.88
percent in August 0%
Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17
2017.*
*Source: Freddie Mac, downloaded from Haver Analytics. Average mortgage rates peaked at 4.3 percent in the week of March 16, 2017.

REALTOR Concerns
REALTOR respondents
reported conditions of low
inventory as the major
issue affecting transactions
in August 2017.

About the RCI Survey
The RCI Survey gathers information from REALTORS about local market conditions
based on their client interactions and the characteristics of their most recent sales for
the month.
The August 2017 survey was sent to 75,000 REALTORS who were selected from
NARs nearly 1.2 million members through simple random sampling and to about
6,000 respondents in the previous three surveys who provided their email addresses.
There were 2,059 respondents to the online survey which ran from September 110,
2017. The surveys overall margin of error at the 95 percent confidence level is 1.9
percent.* The margins of error for subgroups and sample proportions of below or
above 50 percent are larger.
NAR weights the responses by a factor that aligns the sample distribution of
responses to the distribution of NAR membership.
*Based on 2,059 respondents out of 1.2 million NAR members and a 50 percent proportion estimate.

Research Division
National Association of REALTORS
RCI Lead Team
Lawrence Yun, Senior Vice President and Chief Economist
George Ratiu, Managing Director, Housing and Commercial Research
Gay Cororaton, Research Economist
Karen Belita, Data Scientist
Meredith Dunn, Research Communications Manager
The RCI Lead Team acknowledges Jessica Lautz, Managing Director, Survey
Research and Communications, Amanda Riggs, Research Survey Analyst, and
Brandi Snowden, Research Survey Analyst, for their inputs in improving the
survey, editing, and disseminating the report. Acknowledgement goes to Lisa
Herceg, Director, Marketing Research, who sends out the survey to
members.
The REALTOR Confidence Index is provided by NAR solely for use as a
reference. Resale of any part of this data is prohibited without NAR's prior
written consent. For questions on this report or to purchase the RCI series,
please email: Data@realtors.org.

Research Division
National Association of REALTORS
To find out about other products from NARs Research Division, visit:
https://www.nar.realtor/research-and-statistics
Also follow NAR Research on:

https://twitter.com/nar_research
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https://instagram.com/narresearch/

The National Association of REALTORS, The Voice for Real Estate, is Americas largest trade association,
representing 1.2 million members, including NARs institutes, societies and councils, involved in all aspects of the real
estate industry. NAR membership includes brokers, salespeople, property managers, appraisers, counselors and others
engaged in both residential and commercial real estate.
The term REALTOR is a registered collective membership mark that identifies a real estate professional who is a
member of the National Association of REALTORS and subscribes to its strict Code of Ethics.
Working for Americas property owners, the National Association provides a facility for professional development,
research and exchange of information among its members and to the public and government for the purpose of preserving
the free enterprise system and the right to own real property.
NATIONAL ASSOCIATION OF REALTORS

RESEARCH DIVISION
The Mission of the National Association of REALTORS Research Division is to collect and disseminate timely, accurate
and comprehensive real estate data and to conduct economic analysis in order to inform and engage members,
consumers, and policymakers and the media in a professional and accessible manner.
NATIONAL ASSOCIATION OF REALTORS

Research Division
500 New Jersey Avenue, NW
Washington, DC 20001
202-383-1000
data@realtors.org
2017 National Association of REALTORS

All Rights Reserved.
May not be reprinted in whole or in part without permission of the National Association of REALTORS.
For reprint information, contact data@realtors.org.

August 2017
REALTORS CONFIDENCE INDEX SURVEY
Research Division
NATIONAL ASSOCIATION of REALTORS

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August 2017

REALTORS CONFIDENCE INDEX SURVEY

August 2017 REALTORS CONFIDENCE INDEX SURVEY

August 2017 REALTORS CONFIDENCE INDEX SURVEY

Aug-17 Jul-17 Aug-16

August 2017 REALTORS CONFIDENCE INDEX SURVEY

August 2017 REALTORS CONFIDENCE INDEX SURVEY

The REALTORS Confidence REALTORS Confidence IndexCurrent Conditions

August 2017 REALTORS CONFIDENCE INDEX SURVEY

The REALTORS Buyer

conditions one year 70

August 2017 REALTORS CONFIDENCE INDEX SURVEY

August 2017 REALTORS CONFIDENCE INDEX SURVEY

August 2017 REALTORS CONFIDENCE INDEX SURVEY

Median Days on Market of Sales Reported by

days (30 days in July

month when sold, 30

Properties that sold in

August 2017 REALTORS CONFIDENCE INDEX SURVEY

Percentage Distribution of Price Change from a Year Ago

Ninety-one percent of 70% 71%

August 2017 REALTORS CONFIDENCE INDEX SURVEY

Percent of Properties Sold at Original Price or at Net

and supply is tight, offers

2017 sold at or above

Average Number of Clients Taken on a Home Tour by Agent

as the number of 4.5

Average Number of Offers Written Per Client Taken on a

one year ago. 2.0

August 2017 REALTORS CONFIDENCE INDEX SURVEY

weaken over the next six 20

August 2017 REALTORS CONFIDENCE INDEX SURVEY

August 2017 REALTORS CONFIDENCE INDEX SURVEY

* Based on the respondents most recent sale for the month.

August 2017 REALTORS CONFIDENCE INDEX SURVEY

and the aging of the 35%

modest, demand by 20%

August 2017 REALTORS CONFIDENCE INDEX SURVEY

younger have been on 50% 48%

from 26 percent in July 20% 22%

2013 when the RCI

August 2017 REALTORS CONFIDENCE INDEX SURVEY

2017; 44 percent in 20%

August 2016). 10%

August 2017 REALTORS CONFIDENCE INDEX SURVEY

for their most recent 16% 15%

sale in August 2017.

August 2017 REALTORS CONFIDENCE INDEX SURVEY

Distressed Sales as Percent of Residential Sales

With rising home 50%

values, improved 40%

Foreclosed Short sale

August 2017 REALTORS CONFIDENCE INDEX SURVEY

Twenty percent of sales Cash Sales as Percent of Residential Sales

and distressed 30%

has declined compared 20%

August 2017 REALTORS CONFIDENCE INDEX SURVEY

Seller Incentives Offered

Helping cover the

August 2017 REALTORS CONFIDENCE INDEX SURVEY

sellers who sold a 70% 5%

property in July 2017 60%

used the property for 50%