First-time Buyer Share Declines as Investor Share Rises
The REALTORS® Confidence Index (RCI) survey gathers on-the-ground information from REALTORS® based on their real estate transactions in the month. This report presents key results about the January 2022 market transactions.
As mortgage rates continue to rise to over 3%, REALTORS® reported a slowdown in homebuying traffic in January compared to one year ago. The REALTORS® Buyer Traffic Index decreased to 62 (59 in the prior month; 76 one year ago). Listing activity is “weaker” compared to one year ago. The REALTORS® Seller Traffic Index decreased to 33 (37 in the prior month; 35 one year ago). An index below 50 means ‘weaker’ conditions during the month compared to one year ago. Demand continues to outpace supply. On average, respondents reported four client home tours during the month compared to an average of one new listing during the month.
The share of first-time buyers decreased to 27% (30% in the prior month; 33% one year ago). On the other hand, the share of buyers who purchased a home for use as an investment rental or vacation home rose to 22% (17% in the prior month, 15% one year ago). The share of buyers who purchased the property to rent it out rose to 15% (11% in the prior month, 9% one year ago) while the share of buyers intending to use the property as a vacation home rose to 7% (5% in the prior month, 7% one year ago). The share of cash sales rose to 27% (23% in the prior month; 19% one year ago).
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