According to First American’ Real Estate Sentiment Index, confidence for transaction volume growth for the next 12 months rose by 0.4% quarter over quarter in Q1, and was up by 0.63% year over year. With growth in purchase transaction volume, confidence grew by 6.5% quarter over quarter and 3.7% year over year. However, confidence in refinance transaction volume growth for the next 12 months decreased by 5.7% from Q4, and also declined by 2.5% year over year.
Over the next 12 months, prices on all property types are projected to increase by 2.5%. That’s up from Q4, when prices were predicted to increase by 1.7% over 12 months.
“Overall, bullishness about transaction volumes in the coming year increased, largely driven by the rise in purchase transaction expectations,” said Mark Fleming, chief economist at First American. “Overall, year-end confidence in the healthy trajectory of the economy increased purchase transaction expectations, but the likelihood of higher mortgage rates further tempered refinance prospects.
“The increase in overall transaction volume confidence this quarter suggests that title agents and real estate professionals feel the spring homebuying season looks promising. However, the positive outlook for purchase transactions stands in contrast to a further decline in expectations for refinance transactions over the next 12 months.”
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Growing consumer confidence points to a strong spring real estate market, according to new data from First American Financial Corporation.