Realtors® describe their clients' ability to secure financing in the current lending environment same as last year
by Eric Berman - firstname.lastname@example.org - 781-839-5507
WALTHAM, Mass. – June 12, 2019 – The Massachusetts Association of Realtors® (MAR) reported today that the number of single-family homes put under agreement in the month of May went up six percent and the number of condominiums put under agreement went up two percent compared to this time last year. This marks 12 straight months of year-over-year increases for single-family homes. The median price for single-family homes put under agreement increased almost four percent to $420,000, while condominiums saw a seven percent increase to $415,000 compared to May of 2018.
In response to the May ‘Hot Topic’ question, many Realtors® reported that their clients' ability to secure financing has remained the same since 2018.
“The demand for homes remained strong as pending home sales went up for 12 straight months compared to the same 12 months the year before,” said 2019 MAR President Anne Meczywor, broker/associate at Roberts & Associates Realty, Inc., in Lenox. “Once again, we saw historically-low number of homes for sale push median prices up.”
May Realtor® Market and Price Confidence Indexes:
“Our indexes show us that Realtors® felt very positive about the market in general, but also felt some uncertainty as to how high prices can go and what those high prices will do to some of their buyer clients,” said Meczywor.
Monthly ‘Hot Topic’ Question:
The ‘Hot Topic’ question for the month of May asked Realtors® how they would describe their clients' ability to secure financing in the current lending environment, compared to the same time last year.
Of those who responded, a majority (70%) said that their clients' ability to secure financing has remained the same since 2018. Eleven percent of respondents said that their clients have been having a somewhat more difficult time than last year, and four percent said it was significantly more difficult. Another 13 percent responded that their clients have had it somewhat easier this year and a remaining four percent said their clients' ability to secure financing has been significantly easier.
“It is a positive sign that our clients’ ability to secure financing has been consistent,” said Meczywor. “This consistency means that buyers aren’t ‘aiming for a moving target,’ when it comes to knowing what it takes to qualify for a loan.”
About the Data Sets:
The tracking of signed purchase and sales agreements (also called “pending sales”) provide reliable information about where the real estate market is heading in coming months.
A pending sale or a sale “under agreement” happens when the buyer and seller agree on the terms of the sale of a home and have a signed purchase and sale agreement but have yet to close and be recorded as such. MAR is the only organization, which compiles this statewide information from Multiple Listing Services each month.
Monthly pending (or under agreement) data and closed sales data comes from the three Realtor®-affiliated Multiple Listing Services in Massachusetts. They are the Berkshire County Multiple Listing Service, Cape Cod & Islands Association of Realtors® Multiple Listing Service, Inc.; and MLS Property Information Network, Inc. The data is compiled by 10K Research and Marketing, Inc. and updated each month. As a result, previous data may change after the reports have been run.
The Realtor® Index Methodology
The Massachusetts Realtor® Market Confidence Index (RMCI) and Price Confidence Index (RPCI) 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.
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 RMCI 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 Confidence 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 25,000+ 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.