With prices rising every week, lenders as strict as ever, interest rates rising, inventories at decade-low levels and competition for homes breaking their hearts, more and more buyers are reaching their frustration limits.
Two things most every buyer participating in the latest Redfin Real-Time Home-Buyer report agreed upon were prices are going to keep on rising and low inventories are a real pain. Forty-eight percent of buyers listed rising prices as a major concern, up from 40 percent last quarter. Sixty-five percent cited low inventory as a major concern in the first quarter, down slightly from 66 percent last quarter.
Twenty-three percent of buyers expect home prices in their area to “rise a lot” over the next twelve months, up from 22% last quarter; 57% expect prices to “rise a little,” the same as last quarter. Thirteen percent expect prices to “stay the same,” 5 percent expect prices to “drop a little,” and less than 1 percent expects prices to “drop a lot.”
When asked about “major concerns with buying a home this year,” the most common response was still “not enough good homes for sale,” at 65 percent in the second quarter. “General economic concerns” fell yet again, dropping from 19 percent last quarter to just 16 percent this quarter, while “prices are increasing in my area,” shot up from 40 percent last quarter to 48 percent in the second quarter.
Thus it’s no surprise that twice as many buyers believe now is a good time to sell as opposed to a good time to buy. The share of respondents who believe now is a good time to sell shot up again in the second quarter, rising to 67 percent from just 48 percent in the first quarter. Meanwhile, the share of respondents who believe now is a good time to buy fell yet again, decreasing from 40 percent in the first quarter to just 31 percent in the second quarter.
So are these hacked off buyers ready to throw in the towel and negotiate a long term lease with their favorite landlord? Not quite yet.
Looks like more would rather go deeper into debt. Recognizing prices are going to keep going up, 41 percent of buyers said they were “ready to pay more”-if they can get the financing. That’s actually an increase of 34 percent from last quarter. The percentage of buyers who are “taking a break” dropped again this quarter to 30 percent, down 2 percentage points from last quarter. Meanwhile the percentage of buyers who are expanding their search to new areas fell to 44 percent, down from 51 percent in the first quarter.