Consumer Confidence in Real Estate Improves
Here’s some good news for a Monday morning: consumer confidence in real estate and home prices has reached a high of 77 percent, according to a survey published last week by Prudential Real Estate. Confidence in the market is good because it means that perceptions are changing—people feel more at ease with their financial situations and are looking to invest.
Prudential’s national survey indicated that 80 percent of potential buyers are trying to find a good value in homes, even considering other neighborhoods than their top choices. They attribute this confidence to good inventory on the market, assuming that with rising home prices, homeowners would want to sell. Here in Hawaii, however, we are faced with a shortage of homes—supply is very limited, and most home sellers are actually getting more than their asking price.
Does this mean buyers are left in the lurch?
Not according to Kevin Inn, Vice President of Sales & Business Development at Prudential Advantage Realty. He explains that these rising home prices trends can actually help both the seller and the buyer: “It’s a good time for sellers who have a reason to sell, whether it be to downsize, upsize, or simply move to a different neighborhood to get closer to their place of work or schools. While prices are on the rise, and this is good news for sellers, buyers can still benefit by taking advantage of historically low interest rates.”
To put these interest rates in perspective: average mortgage interest rates in 2012 were 3.6 percent. Look back 20 years to 1982, and that average interest rate was 16.04 percent. So maybe this really is a win-win real-estate market.