REALTOR® Price Index flat from March-to-April
WALTHAM, Mass. – May 17, 2011 – The Massachusetts Association of REALTORS® (MAR) today announced that the April REALTOR® Market Index (RMI) was down 5.7 percent from March. This is the first month-to-month decrease since November 2010. The REALTOR® Price Index (RPI) was essentially flat from March as prices continue to be more affordable. Both indexes continue to be down from the same time last year.
“REALTORS® have been reporting that activity across the state has been up, but the lack of offers being made has nudged the confidence down a bit of those who filled out the monthly survey,” said 2011 MAR President Laurie Cadigan, broker/owner of Barrett & Company in Concord. “Questions about the economy still linger and while affordability continues to be good, buyer uncertainty remains prevalent.”
In April 2011, the REALTOR® Market Index was 30.28, which was down 5.7 percent from the March 2011 score of 32.09. This is the first month-to-month decrease since November 2010. On an annual basis, the April RMI was down 41.51 percent from the 51.76 score in April 2010. This is the 11th straight month that the year-over-year RMI has gone down. When comparing year-over-year numbers, it is important to note that April 2010 was the last month buyers were able to take advantage of the home buyer tax credit. Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition.
In April 2011, the REALTOR® Price Index was 48.64, which is essentially flat from the March 2011 RPI of 48.69 (down less than two tenths of a percent). On an annual basis, the RPI was down 12.5 percent from the April 2010 RPI of 55.59. This is the 10th straight monthly year-over-year decrease.
When REALTOR® members were asked about what type of impact more affordable home prices have had on buyer activity, 60 percent responded that there was a either a significant increase (5%) or some increase (55%) in buyer activity. Thirty percent responded that there was no change in buyer activity because of more affordable prices. Only nine percent said there were was a decrease in buyer activity and no respondents indicated there was a significant decrease in buyer activity because of the more affordable prices.
About the REALTOR® Index Methodology:
The Massachusetts REALTOR® Market Index (RMI) and Price Index (RPI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market. More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.
1. How would you describe the current housing market?
2. What are your expectations of home prices over the next year?
In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.
The RMI is calculated in the following way. Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points). The results are the average score for each question. A score of 50 is the threshold between a “strong” and a “weak” condition. Similarly, the question about home prices over the next year (REALTOR® Price Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points).
About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 19,000 members. The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.
Editors and reporters: Please note that the term Realtor is properly spelled with an initial capital “R”, per the Associated Press Stylebook.