An increase in foot traffic at open houses and showings are contributing to higher home sales, according to data from the National Association of Realtors® (NAR) recent Foot Traffic report provided by SentriLock.
The report indicates a ten point gain in foot traffic in June 2015, the highest level in twelve months, matching up to the increase in home sales for the month as well. Overall, there has been an increasing trend in traffic from open houses and showings since February 2015 with traffic surging 18 percent so far this year.
NAR considers foot traffic as a one to two month window into future sales trends, a forecasting tool, for instance. An uptick in traffic means that the number of sales contracts will most likely rise within the next sixty days, while a downward trend would indicate a likely decrease in future sales activity.
Increased Demand in Home Ownership
Improved job and economic conditions combined with historically low mortgage interest rates are contributing to an increased demand in home ownership in Chicago and other major markets around the nation. The recent Employment Situation Summary by the Bureau of Labor Statistics (BLS) pegs the national unemployment rate at 5.3 percent for June 2015. This is the lowest the unemployed rate has been since April 2008.
More importantly, the report shows that not only are more people getting jobs, but the number of long-term unemployed individuals, who represent one out of four unemployed workers, is also decreasing.
Average hourly wages of all non-farm employees increased to $24.95 per hour, a 2 percent Y-O-Y increase. The most job gains were in professional and business services which added 64,000 jobs, followed by health care, retail and financial sectors. In fact, all sectors reported job gains with the exception of the mining industry which had a loss of 4,000 workers in June.
More Discerning Home Buyers
The increase in foot traffic at open houses and showings along with an improving job market bodes well for real estate agents and anyone interested in real estate careers.
While home sales are rising, prospective home buyers are also more demanding. For example, there is an increase in mortgage applicants who are interested in turn-key ready properties that require little to no work. Updated kitchens and baths remain the highest priority of prospective buyers. So it is a good idea to educate clients on sprucing up their property and perhaps even consider home staging to make it more appealing to discerning buyers.