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Homebuyers becoming dispirited even as economic confidence grows

Americans are growing increasingly confident in the economy and their financial situation, however this is not translating into a more positive view that now is a good time to buy a home, according to the National Association of Realtors’ first quarter Housing Opportunities and Market Experience survey. Homeowners, older respondents and those living in the more affordable regions of the Midwest and South held a more positive outlook. “The critical shortage of listings in most markets continues to spark a hike in home prices that is not easy for many buyers – and especially first-time buyers – to overcome,” NAR Chief Economist Lawrence Yun said. Many house hunters are telling Realtors that they are dispirited by the stiff competition for the short number of listings they can afford.” And now experts are saying this competition and rising home prices are only going to get worse as the spring home buying season kicks into full gear. An increased share of homeowners now believe now is a good time to sell their home. The share of homeowners saying now is a good time to sell increased from 71% last quarter to 74% in the first quarter. This is second to the third quarter last year’s all-time high of 75%. Economic optimism was down slightly from the first quarter last year, when it hit 62%. “This troublesome reality is what’s dampening moods and keeping many would-be buyers at bay.” Along with the heavy competition, saving up for a down payment is also one of the barriers preventing non-homeowners from buying a home. The index showed while home prices are increasing, “real house prices,” or its affordability measure, are down a full 35.8% from the housing boom peak and 13.8% from the January 2000 price levels.