REALTORS® Confidence Index Survey: February 2018 Highlights

The REALTORS® Confidence Index (RCI) survey[1] gathers monthly information from REALTORS® about local real estate market conditions, characteristics of buyers and sellers, and issues affecting homeownership and real estate transactions.[2] This report presents key results about market transactions from February 2018. View and download the full report here.

Market Conditions and Expectations

• The REALTORS® Buyer Traffic Index registered at 70 (70 in February 2017).[3]
• The REALTORS® Seller Traffic Index registered at 44 (41 in February 2017).
• The REALTORS® Confidence Index—Six-Month Outlook Current Conditions registered at 74 for detached single-family, 62 for townhome, and 58 for condominium properties. An index above 50 indicates market conditions are expected to improve.
• Properties were typically on the market for 37 days (45 days in February 2017).
• Eighty-eight percent of respondents reported that home prices remained constant or rose in February 2018 compared to levels one year ago (90 percent in February 2017).

Characteristics of Buyers and Sellers

• First-time buyers accounted for 29 percent of sales (32 percent in February 2017).
• Vacation and investment buyers comprised 15 percent of sales (15 percent in February 2017).
• Sales of distressed properties (foreclosed or sold as a short sale) accounted for four percent of sales (seven percent in February 2017).
• Cash sales made up 24 percent of sales (27 percent in February 2017).
• Twenty-one percent of sellers offered incentives such as paying for closing costs (nine percent), providing a warranty (nine percent), undertaking remodeling (three percent), and providing appliances (one percent).[4]

Issues Affecting Buyers and Sellers

• From December 2017–February 2018, 76 percent of contracts settled on time (70 percent in February 2017).
• Among sales that closed in February 2018, 76 percent had contract contingencies. The most common contingencies pertained to home inspection (58 percent), getting an acceptable appraisal (44 percent), and obtaining financing (44 percent).
• REALTORS® report “low inventory” and “interest rate” as the major issues affecting transactions in February 2018.

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 February 2018 survey was sent to 50,000 REALTORS® who were selected from NAR’s 1.3 million members through simple random sampling and to 7,295 respondents in the previous three surveys who provided their email addresses.
• There were 3,560 respondents to the online survey which ran from March 1‒9, 2018. The survey’s overall margin of error at the 95 percent confidence level is two 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

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[1] 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.

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

[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.