REALTORS® Confidence Index Survey: December 2017 Highlights

The REALTORS® Confidence Index (RCI) survey gathers monthly information from REALTORS® about local real estate market conditions, characteristics of buyers and sellers, and issues affecting homeownership and real estate transactions.[1] This report presents key results about market transactions from December 2017. View and download the full report here. [2] Market Conditions and Expectations
The REALTORS® Buyer Traffic Index registered at 66 (57 in December 2016).[3] The REALTORS® Seller Traffic Index registered at 47 (39 in December 2016).
The REALTORS® Confidence Index—Six-Month Outlook Current Conditions registered at 77 for detached single-family, 63 for townhome, and 60 for condominium properties. An index above 50 indicates market conditions are expected to improve.
Properties were typically on the market for 40 days (52 days in December 2016).
Ninety percent of respondents reported that home prices remained constant or rose in December 2017 compared to levels one year ago (87 percent in December 2016).

Characteristics of Buyers and Sellers
First-time buyers accounted for 32 percent of sales (32 percent in December 2016).
Vacation and investment buyers comprised 16 percent of sales (14 percent in December 2016).
Sales of distressed properties (foreclosed or sold as a short sale) accounted for five percent of sales (seven percent in December 2016).
Cash sales made up 20 percent of sales (21 percent in December 2016).
Twenty percent of sellers offered incentives such as paying for closing costs (nine percent), providing a warranty (seven percent), and undertaking remodeling (five percent).[4]

Issues Affecting Buyers and Sellers
From October–December 2017, 71 percent of contracts settled on time (61 percent in December 2016).
Among sales that closed in December 2017, 75 percent had contract contingencies. The most common contingencies pertained to home inspection (55 percent), obtaining financing (43 percent), and getting an acceptable appraisal (42 percent).
REALTORS® report “low inventory” and “tax reform” as the major issues affecting transactions in December 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 December 2017 survey was sent to 50,000 REALTORS® who were selected from NAR’s nearly 1.2 million members through simple random sampling and to 6,225 respondents in the previous three surveys who provided their email addresses.
There were 4,283 respondents to the online survey which ran from January 1‒10, 2018. The survey’s overall margin of error at the 95 percent confidence level is one percent. The margins of error for subgroups and sample proportions of below or above 50 percent are larger.
NAR weighs the responses by a factor that aligns the sample distribution of responses to the distribution of NAR membership.
The REALTORS® 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

[1] Respondents report on the most recent characteristics of their most recent sale for the month.

[2] Thanks to George Ratiu, Managing Director, Housing and Commercial Research and Gay Cororaton, Research Economist for their data analysis and comments to the RCI Report.

[3] An index greater than 50 means more respondents reported conditions as “strong” compared to one year ago than “weak.” An index of 50 indicates a balance of respondents
who viewed conditions as “strong” or “weak.”

[4] The difference in the sum of percentages to the total percentage of sellers who offered incentives is due to rounding.