Message from the President
by Dawn Brown
Realtors Housing Expectations for 2017
As another strong year for the housing market has come to an end and the calendar turned over to 2017, it is time to examine the housing outlook and expectations for the new year.
Existing-home sales are forecast to muster only a small gain in 2017 because of increasing mortgage rates and shrinking consumer confidence that now is a good time to buy a home, according to new consumer survey findings and a 2017 housing forecast from the National Association of Realtors®.
NAR’s Housing Opportunities and Market Experience (HOME) survey, which asked respondents about their confidence in the U.S. economy and housing expectations for 2017, recently found that 68 percent of homeowners think now is a good time to make a home purchase compared to 82 percent in December 2015.
Even with this dip in buyer enthusiasm, the market did well and existing sales closed 2016 3.3 percent higher than 2015 and reached around 5.42 million — the highest since 2006 when sales totaled 6.47 million.
In 2017, sales are forecast to grow roughly 2 percent to around 5.52 million. The national median existing-home price rose to around 5 percent in 2016 and is expected to rise to about 4 percent in 2017. By the end of next year, mortgage rates are expected to reach around 4.6 percent.
Existing-home sales are expected to see little expansion in 2017 because of affordability tensions from rising mortgage rates and home prices continuing to outpace income growth. Ultimately, the market needs to see a growth in for sale inventory, otherwise the nation’s low homeownership rate will struggle to rise in 2017.
Here are a few of the trends and predictions you can expect to see play out in the new year.
Tight inventory conditions will continue. Recent data from NAR show that the supply of existing homes for sale is insufficient, and new home construction is not meeting demand. More buyers are competing for a fewer number of affordable homes than a year ago, which will likely continue in 2017.
Increasing home prices. With demand rising and listings scarce in many markets, NAR forecasts home prices will increase nationally about 4 percent in 2017. In cities with the tightest of supply, prices could expand above double digits.
Rising mortgage rates. The recent rise in mortgage rates will likely continue in 2017 with additional increases. With inventory tight and prices already rising far above incomes in some areas, the unwelcoming sign of higher borrowing costs only adds to the difficult barrier of entry for many prospective buyers.
Waning consumer confidence. Declining affordability in many parts of the country has been weakening consumer morale. Rents and home prices outpacing incomes and scarce supply in the affordable price range will continue as a prominent headwind for many prospective buyers this year.
Buying a home can sometimes be a challenging process, but with a little work and a Realtor® a member of the National Association of Realtors® at your side, 2017 may be a good time to start looking.
Agency/New Requirement for License Renewal - The new requirement is at least one hour of law of agency. However, if a salesperson is within their first license renewal term, they must complete two hours of agency. This change does not apply to those licensees who are exempt from continuing education requirement. BNAR is offering Law of Agency classes in January so you can fulfill this requirement.
Participate in Calls to Action – Text REALTORS to 30644 and sign up for the Calls to Action. You will receive important messages about Calls to Action a few times a year letting you know that it is time to take action on an important real estate issues and to help protect and promote our industry. More than 700,000 members from across the country have already signed up for the mobile alerts, why not you?
RPAC Dollars are working for You? The return on RPAC investments means savings for REALTORS and consumers. Did you know that $13,698 per REALTOR in additional income was generated through the homebuyer tax credit? That is just one of our returns on RPAC investments. Continue to invest in your business. Give your Fair Share of $25.00.
Any individual who has at least one year experience in real estate sales, are licensed and actively practicing in New York State and who hold primary REALTOR membership in New York State is eligible to receive a scholarship to one of the NAR Designation/Certification course. Application must be completed and postmarked by December 31, 2016. Here is the link to the list of scholarships, rules and application.