Homebuyers held off purchasing homes in June due to rising home prices, Credit Suisse reported in their monthly traffic survey of real estate agents.
"Comments from agents in June suggest that buyers are growing increasingly discouraged by economic and employment conditions, and as a result, have made the decision to hold-off on purchases—particularly at current prices," the company reported.
Out of the 40 markets surveyed, 32 saw lower than expected traffic, five were in line with expectations and three saw better than expected traffic. Those numbers were all a decline from May, when only 28 were below expectations and five saw better than expected traffic.
The only three markets that saw better than expected traffic last month were Columbus, Ohio, Ft. Myers, Florida, and Dallas. Some of the weakest markets were San Diego, New York/Northern New Jersey and Phoenix, which all saw Buyer Traffic Index levels below 30 (50 is neutral, where the traffic met expectations).
In spite of the lack of buyers, 34 of the 40 markets saw higher prices sequentially in June. Phoenix remained one of the markets with the lowest prices for the seventh straight month.
The report includes comments from real estate agents across the country:
- Atlanta (traffic index at 28) — "First-time buyers virtually non-existent; luxury high-end selling; volume of sales is way down."
- Austin (traffic index at 46) — "Multiple offers within a day or two on attractive properties are becoming the new norm."
- Charlotte (traffic index at 25 from 50 in May) — "Prices should remain supported despite the weak traffic as inventory levels contracted from already low levels."
- Los Angeles (traffic index at 45) — "Still seeing lots of foreign investors."
- Nashville (traffic index at 50) — "Low supply. We are receiving multiple offers on same property and bidding wars. Days on market are becoming more like hours on market because of low supply and high demand. Offers are many times made above the asking prices to keep others from beating a buyer out of a purchase."
- New York/Northern New Jersey (traffic index at 23) — "Stalemate. Buyers expect deal and sellers expect rebound in market pricing."
- Sacramento (traffic index at 22) — "Many buyers are tired of the processes demanded by banks to get the loans they want. Higher interest rates and higher prices for a limited inventory."
- San Diego (traffic index at 54) — "Prices may have risen too fast. Buyers are having difficulties qualifying for loans. The FHA MI is knocking a lot of first-time homebuyers out."