The housing market remains on edge heading into the rest of 2014 as broad-based demands challenges remain an issue.
“Similar to recent months, comments from agents about a lack of buyer urgency, driven by weak confidence in economic conditions and an unwillingness to pay current prices, dominated responses,” the report said.
What’s interesting is that declining mortgage rates failed to drive mortgage demand.
These struggles can be seen in most of the top 5 housing markets.
Phoenix, Arizona – 5th
This has been a tough year for Phoenix as weak traffic trends continue. The traffic index slightly moved to 20 in October from 16 in September, with agents highlighting the same issues that have been plaguing housing. This includes lack of buyer urgency, sellers holding prices at high levels despite challenging demand conditions and a softer local economy.
(Source Credit Suisse; click to enlarge)
Washington D.C.- 4th
Washington D.C. produced more of the same results in October, with buyer traffic slightly worsening as agents report demand falling short of expectations. As a result, the market’s traffic index increased from 9 to 11. Meanwhile, prices continued to edge lower as weak demand conditions have been met by rising inventories and a consistently lengthening time to sell in recent months.
Atlanta – 3rd
Although buyer traffic increased, it is still only at a weak 23 in October from 14 in September. Agents noted that a lack of quality inventory continues to be an issue, forcing some borrowers to hold off on the purchase process. And the buyers remaining are struggling to come to a middle ground with sellers. In the near-term, Credit Suisse expects weak home price trends as weak demand levels have been leading to a longer sell time.
Dallas – 2nd
Dallas experienced a rough month in October as the traffic index plunged to 20 from 50 the previous month. According to agents, affordability remains the most significant headwind, preventing more robust demand growth. Additionally, the home price index increased to 67 from 55 last month.
Houston – 1st
Houston witnessed the most improvement compared to others on the list, with the market producing a nice pick up in demand in October. The buyer traffic index improved to 57 from 33, with traffic modestly ahead of agent expectations. Agents noted tight inventory is still and issues, and leaves it a sellers’ market. However, some saw increasing local economic concerns, which may have been related to oil volatility.