REALTORS CONFIDENCE INDEX SURVEY

Report on the November 2015 Survey

The REALTORS Confidence Index (RCI) report provides monthly information about real estate
market conditions and expectations, buyer/seller traffic, price trends, buyers characteristics, and
issues affecting real estate based on a monthly survey of REALTORS.
The November 2015 report is based on the responses of 2,643 REALTORS about local market
conditions experienced in November and the characteristics of their most recent sale for the
month. The data collected from a random sample of REALTORS is viewed to be representative
of the sales for the month. 1 The online survey was conducted from December 2-9, 2015. All real
estate is local: conditions in specific markets may vary from the overall national trends presented
in this report. REALTORS may be interested in comparing their markets against the national
summary.
The RCI report is an output of the Research Division of the NATIONAL ASSOCIATION of
REALTORS. 2 For questions or information about this report, please email dhale@realtors.org.

Lawrence Yun, Senior Vice President and Chief Economist

Danielle Hale, Managing Director, Housing Research
Gay Cororaton, Research Economist
Meredith Dunn, Research Communications Manager

Research Division
NATIONAL ASSOCIATION of REALTORS
500 New Jersey Avenue, NW
Washington, DC 20001
202.383.1000
1

The survey is sent to 50,000 REALTORS who are selected through simple random sampling. To increase the response rate,
the survey is also sent to respondents in the previous three surveys who provided their email addresses. The number of responses
to a specific question varies because the question may not be applicable to the respondent or because of non-response. To
encourage survey participation, eight REALTORS are randomly selected to receive a gift card.
2
Thanks to Jessica Lautz, Managing Director, Survey Research and Communications, Meredith Dunn, Research
Communications Manager, Brandi Snowden, Research Survey Analyst, and Amanda Riggs, Research Survey Analyst, for their
input in improving the survey questions and in editing the report.

Table of Contents
Summary .................................................................................................................................................... 3
I.

Market Conditions ............................................................................................................................ 4

REALTORS Broadly Reported Unchanged Market Conditions from a Month Ago ............................ 4
REALTORS Still Broadly Optimistic Over the Next Six Months ........................................................ 5
REALTORS Reported Slower Buyer and Seller Traffic Compared to a Year Ago .............................. 7
REALTORS Expect Prices to Increase Modestly in Next 12 Months................................................... 9
Properties on the Market at 54 Days ....................................................................................................... 10
II. Buyer and Seller Characteristics ......................................................................................................... 12
Sales to First-Time Buyers: 30 Percent of Sales ..................................................................................... 12
Sales for Investment Purposes: 16 Percent of Sales ............................................................................... 13
Distressed Sales: Nine Percent of Sales .................................................................................................. 13
Cash Sales: 27 Percent of Sales .............................................................................................................. 15
Age, Previous Residence, and Type of Property Purchased ................................................................... 17
III. Current Issues .................................................................................................................................... 19
Impact of TRID on Contract Settlement ................................................................................................. 19
Contract Settlement Issues: Financing, Home Inspection, and Appraisals are Major Issues ................. 20

Summary
Market conditions vary across local markets and states, but the REALTORS confidence and
traffic indices indicate no substantial change in market activity in November 2015 compared to
October 2015. Compared to a year ago, market activity improved. Sustained job creation, the low
interest rate environment, and measures to reduce the cost of borrowing and make credit more
accessible to responsible borrowers continue to bolster the housing market recovery. However,
the implementation of the TILA/RESPA Integrated Disclosure (TRID) regulations on October 3,
2015, appears to be delaying the settlement of contracts and impacting sales. About 47 percent of
respondents reported longer closing times compared to a year ago, up from 37 percent in the
October 2015 survey.
First-time home buyers accounted for 30 percent of sales, essentially unchanged from the
previous months figures. Cash sales rose to 27 percent of sales as purchases for investment
purposes also increased to 16 percent of sales and distressed properties rose to nine percent of
sales. Properties typically sold within 54 days nationally compared to 65 days a year ago. It
typically took another 40 days to close a sale, up from 35 days in July 2015.
Tight inventories, decreased affordability, and more stringent credit standards continued to be
reported as key issues affecting sales, especially of first-time homebuyers. Late and low
appraisal valuation, tighter inspection guidelines, and difficulty in obtaining financing for
condominium purchases were also reported as factors weighing down the market recovery.
November 2015 REALTORS Confidence Index Survey Highlights
RCI Current Conditions: Single-Family Sales
RCI Six-Month Outlook: Single-Family Sales
RCI Buyer Traffic Index
RCI Seller Traffic Index
1
First-Time Home Buyers, as Percent of Sales
Sales to Investors, as Percent of Sales
Cash Sales, as Percent of Sales
Distressed Sales, as Percent of Sales
Median Days on Market
Median Expected Price Growth in Next 12 Months (%)

Nov 2015
57
68
50
38
31
16
27
9
54
3.2

Oct 2015
57
63
52
40
31
13
24
6
57
3.2

Nov 2014
49
60
43
35
31
15
25
9
65
3.0

1 - NARs 2015 Profile of Home Buyer and Sellers (HBS) reports that among primary residence home buyers, 32 percent
were first-time home buyers. The HBS surveys primary residence home buyers, while the monthly RCI Survey surveys
REALTORS and also captures purchases for investment purposes and vacation/second homes.

I.

Market Conditions

REALTORS Broadly Reported Unchanged Market Conditions from a Month Ago

Market conditions vary across local markets and states, but the indices on current conditions
indicate that market activity in November 2015 was substantially unchanged compared to
October 2015. Compared to a year ago, REALTORS broadly reported stronger market activity.
REALTORS reported the implementation of the TILA/RESPA Integrated (TRID) guidelines on
October 3, 2015, has led to a longer time to close transactions, with about 47 percent of all
respondents reporting a longer time to close compared to a year ago.
The REALTORS Confidence Index - Current Conditions chart below shows the single-family
homes index stayed at 57, a level consistent with more respondents citing strong than weak
market conditions (57 in October 2015; 49 in November 2014). 3 The index for townhomes also
stayed at 41, while the index for condominiums fell to 36, and both were both below 50, which
indicates that more respondents viewed their markets as weak rather than strong.
REALTORS continued to report on the difficulty of obtaining financing for condominium unit
purchases because many condominiums are not FHA or GSE eligible. 4
REALTORS Confidence Index: Current Conditions
as of November 2015
(50 = "Moderate" Conditions)
80
70
60
50
40
30
20
10
0

57
41

200801
200805
200809
200901
200905
200909
201001
201005
201009
201101
201105
201109
201201
201205
201209
201301
201305
201309
201401
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201409
201501
201505
201509

36

Single-family

Townhome

Condominium

3
This is a diffusion index which measures the direction of and broadness of the respondents market conditions or confidence.
An index of 50 indicates a balance of respondents having weak (index=0) and strong (index=100) expectations or all
respondents having moderate (=50) expectations. The index is not adjusted for seasonality effects.
4
FHA and the GSEs have financing eligibility criteria relating to ownership occupancy requirements, delinquent dues, project
approval process, and use for commercial space. See the Statement of the National Association of REALTORS Submitted for the
Record to the Senate Committee on Banking Housing and Urban Affairs on December 9, 2014 at
http://www.ksefocus.com/billdatabase/clientfiles/172/1/2180.pdf

REALTORS Still Broadly Optimistic Over the Next Six Months

Local market conditions vary, but REALTORS remained by and large strongly confident
about the outlook over the next six months for single-family homes. 5 The REALTORS
Confidence Index - Six-Month Outlook registered at 68 (63 in October 2015; 60 in November
2014). The confidence index for townhomes rose to 51, indicating moderate conditions (47 in
October 2015; 44 in November 2014). The index for condominiums also rose but stayed below
50, indicating that more respondents viewed their markets as weak than strong.

68
51
47

200801
200805
200809
200901
200905
200909
201001
201005
201009
201101
201105
201109
201201
201205
201209
201301
201305
201309
201401
201405
201409
201501
201505
201509

80
70
60
50
40
30
20
10
0

REALTORS Confidence Index: Six-Month Outlook

as of November 2015
(50 = "Moderate" Outlook)

Single-family

Townhome

Condominium

The following maps show the REALTORS Confidence Index - Six-Month Outlook across
property types by state. All states, except for New Mexico, Vermont, and Connecticut had
broadly strong to very strong markets. 6 States with large oil-related sectors such as Texas,
North Dakota, and Louisiana still had broadly strong housing markets. In the townhomes and
condominium markets, only a handful of states have broadly strong markets, which includes
California, Oregon, Washington, North Dakota, Utah, Colorado, Michigan, Florida, and the
District of Columbia. REALTORS have reported difficulty in accessing condominium unit
purchase financing for both FHA-insured and GSE-backed loans. Only 20 percent of
condominiums are eligible for FHA condominium unit financing because of strict eligibility
criteria such as those pertaining to occupancy requirements and delinquency dues. 7

Respondents were asked What are your expectations for the housing market over the next six months compared to the current
state of the market in the neighborhood(s) or area(s) where you make most of your sales?
6
The market outlook for each state is based on data for the last three months to increase the observations for each state. Small
states such as AK, ND, SD, MT, VT, WY, WV, DE, and D.C., may have less than 30 observations. Respondents rated conditions
or expectations as Strong (100), Moderate (50), and Weak (0). The responses are compiled into a diffusion index. Values
25 and lower are considered very weak, values greater than 25 to 49 are considered weak, a value of 50 is considered
moderate, values greater than 50 to 75 are considered strong, and values greater than 76 are considered very strong.
7
http://www.realtor.org/topics/condominiums/condominium-resource-book

REALTORS Reported Slower Buyer and Seller Traffic Compared to a Year Ago
While local conditions vary, buyer traffic eased in November 2015 compared to October 2015,
but was broadly strong compared to a year ago when the index indicated a weak market. The
REALTORS Buyer Traffic Index registered at 50 in November 2015 (52 in October 2015; 43 in
November 2014).
Meanwhile, supply remains tight. The REALTORS Seller Traffic Index registered at 38 (40 in
October 2015 and 35 in November 2014). While the construction of new privately owned
housing units has been improving, reaching 1.2 million units in the third quarter of 2015, roughly
35 percent of recent new construction has been multi-family structures which are typically for
rental occupancy. Historically, multi-family structures accounted for only 20 percent of new
construction, so the availability of single-units for purchase among recently constructed
properties is lower than is historically normal. REALTORS reported low inventory of
properties in the lower price range and for those that are move-in ready.

80

REALTORS Buyer and Seller Traffic Indexes

as of November 2015
(50 = "Moderate" Conditions)

70
60

50

50
40

38

30

200801
200805
200809
200901
200905
200909
201001
201005
201009
201101
201105
201109
201201
201205
201209
201301
201305
201309
201401
201405
201409
201501
201505
201509

20

Buyer Traffic Index

Seller Traffic Index

Buyer traffic was strong in 24 states and very strong in the District of Columbia, measured
by the REALTORS Buyer Traffic Index. 8

The index for each state is based on data for the last three months to increase the observations for each state. Small states such
as AK, ND, SD, MT, VT, WY, WV, DE, and D.C., may have less than 30 observations. Respondents were asked How do you
rate the past month's buyer traffic in the neighborhood(s) or area(s) where you make most of your sales? The responses were
Strong (100), Moderate (50), and Weak (0). Respondents rated conditions or expectations as Strong (100), Moderate
(50), and Weak (0). The responses are compiled into a diffusion index. Values 25 and lower are considered very weak,
values greater than 25 to 49 are considered weak, a value of 50 is considered moderate, values greater than 50 to 75 are
considered strong, and values greater than 76 are considered very strong.

Meanwhile, seller traffic was broadly weak across most states, measured by the REALTORS
Seller Traffic Index. 9 Seller traffic was strong in North Dakota and moderate in New
Hampshire.

REALTORS Expect Prices to Increase Modestly in Next 12 Months

REALTORS who responded to the November 2015 survey expected prices to increase by 3.2
percent over the next 12 months (3.2 percent in October 2015; 3.0 percent in November 2014).
REALTORS expect the recent strong price growth to moderate as rising prices have made
homes unaffordable for many. The pace of price increase has started to moderate: the median
price of an existing home fell to $219,600 in October 2015 from $221,700 in September 2015.
The map shows the median expected price change in the next 12 months for each state based on
the September November 2015 RCI surveys. 10 REALTOR respondents from Washington,
Oregon, Wyoming, Colorado, and Florida were the most upbeat, with a median expected price
growth in the range of four to five percent. Compared to expectations in previous months, no
state had a median expected price growth of over five percent, an indication that prices are
expected to rise at a modest pace in the next 12 months.

Respondents were asked How do you rate the past month's seller traffic in the neighborhood(s) or area(s) where you make
most of your sales? The responses were Strong (100), Moderate (50), and Weak (0). Respondents rated conditions or
expectations as Strong (100), Moderate (50), and Weak (0). The responses are compiled into a diffusion index. Values 25
and lower are considered very weak, values greater than 25 to 49 are considered weak, a value of 50 is considered
moderate, values greater than 50 to 75 are considered strong, and values greater than 76 are considered very strong.
10
In generating the median price expectation at the state level, we use data for the last three surveys to have close to 30
observations. Small states such as AK, ND, SD, MT, VT, WY, WV, DE, and D.C., may have less than 30 observations.

Properties on the Market at 54 Days

Properties that closed in October 2015 were typically on the market for a shorter time compared
to a year ago, staying on the market for 54 days (57 days in October 2015; 65 days in November
2014). 11 Fewer days on the market is an indication that inventory remains tight. Short sales were
on the market for the longest time at 91 days, while foreclosed properties typically stayed on the
market for 47 days. Non-distressed properties were typically on the market for 54 days.

All: 54

Foreclosed: 47

201202

200

201108

Median Days on Market of Sales Reported By REALTOR

Respondents as of November 2015
Short sale: 91

Not distressed: 54

150
100
50

All

Foreclosed

Short sale

201511

201508

201505

201502

201411

201408

201405

201402

201311

201308

201305

201302

201211

201208

201205

201111

201105

Not distressed

Approximately 37 percent of properties were on the market for less than a month when sold.
About 12 percent were on the market for longer than six months, a decrease from 30 percent in
January 2012. Properties that stay on the market for longer are more likely to sell at a discount.
11

Respondents were asked For the last house that you closed in the past month, how long was it on the market from listing time
to the time the seller accepted the buyers offer? The median is the number of days at which half of the properties stayed on the
market. In generating the median days on market at the state level, we use data for the last three surveys to have close to 30
observations. Small states such as AK, ND, SD, MT, VT, WY, WV, DE, and D.C., may have less than 30 observations.

10

Percentage Distribution of Time on Market of Sales Reported by

REALTOR Respondents as of November 2015

40%
35%
30%
25%
20%
15%
10%
5%
0%

Less than 1 to less 2 to less 3 to less 4 to less 5 to less 6 to less 9 to less

12
1 month than 2
than 3
than 4
than 5
than 6
than 9 than 12 months or
months months months months months months months
more
201411

201510

201511

Percent of sales, by days on market

Properties That Stay Longer on the Market are More Likely to

Be Sold at a Discount, January-November 2015
100%
80%
60%
40%
20%
0%
Less than 1
months

Less than 3
months

6 to less than 9
months

12 months or
more

Days on Market
Net discount of 12% or higher
Net discount of less than 4%
Net premium of up to 4%
Net premium of 12% or higher

Net discount of 4% to 11%

No discount or premium
Net premium of 4% to 11%

Properties typically sold within a month in the District of Columbia, Utah, Colorado, South
Dakota, and Hawaii. Despite the slump in oil prices, properties typically sold within two months
in Texas, Nebraska, Kansas, and Louisiana. All real estate is local. State-level data is provided
for REALTORS who may want to compare local markets against the state and national
summary.

11

II. Buyer and Seller Characteristics

Sales to First-Time Buyers: 30 Percent of Sales
The share of first-time home buyers has remained essentially unchanged for the last five years.
First-time home buyers accounted for 30 percent of existing home sales in November 2015 (31
percent in October 2015; 31 percent in November 2014). 12 REALTOR respondents reported
that tight inventory, increasingly unaffordable prices, and credit profiles that fail to meet tighter
underwriting standards are conditions that continue to work against first-time home buyers.

12

First-time buyers accounted for about 32 percent of all home buyers based on data from NARs 2015 Profile of Home Buyers
and Sellers (HBS). The HBS is a survey of primary residence home buyers and does not capture investor purchases but does
cover both existing and new home sales. The RCI Survey is a survey of REALTORS about their transactions and captures
purchases for investment purposes and second homes for existing homes.

12

First-time Buyers as Percent of Market as of November 2015

60%
50%
40%

30%

30%
20%
10%

200810
200902
200906
200910
201002
201006
201010
201102
201106
201110
201202
201206
201210
201302
201306
201310
201402
201406
201410
201502
201506
201510

0%

Sales for Investment Purposes: 16 Percent of Sales

Approximately 16 percent of REALTORS reported that their last sale was for investment
purposes (13 percent in October 2015; 15 percent in November 2014). Purchases for investment
purposes have generally been on the decline with fewer distressed sales on the market. At their
peak in 2012-2013, investment sales were approximately 20 percent of sales.
Sales to Investors as Percent of Residential Market
as of November 2015
30%
25%
20%

16%

15%
10%
5%

200810
200902
200906
200910
201002
201006
201010
201102
201106
201110
201202
201206
201210
201302
201306
201310
201402
201406
201410
201502
201506
201510

0%

Distressed Sales: Nine Percent of Sales

Distressed sales accounted for nine percent of sales (six percent in October 2015; nine percent in
November 2014). Foreclosed properties were seven percent of sales, while short sales were two

13

percent of sales. 13 With rising home values and fewer foreclosures, the share of sales of
distressed properties has generally continued to decline. Distressed sales accounted for about a
third to a half of sales until 2011. Distressed properties sold at a discount of ten to 19 percent,
depending on the condition of the property.
Distressed Sales, As Percent of Sales Reported by REALTOR
Respondents as of November 2015
60%
50%
40%

Foreclosed: 7% Short sale: 2%

30%
20%
10%

200810
200902
200906
200910
201002
201006
201010
201102
201106
201110
201202
201206
201210
201302
201306
201310
201402
201406
201410
201502
201506
201510

0%

Foreclosed

Short sale

Mean Percent Price Discount by Property Condition

of Distressed Sales in Past 12 Months
Ended November 2015
19%

20%
15%
10%

14%
10%

10%

18%

12%

5%
0%
Above average

Average
Foreclosed

Below average

Short sale

Distressed sales have fallen, with fewer properties in foreclosure (739,847 properties in the
foreclosure inventory as of the third quarter of 2015 from a peak of two million properties in
2009-2010, or 1.9 percent of mortgages). 14 Fewer distressed sales and foreclosures improve
home values, creating more home equity for the homeowner. As of the second quarter of 2015,
the equity of all households in real estate was valued at $12.4 trillion, or 57 percent of the value
13
14

The survey asks respondents to report on the characteristics of the most recent sale for the month.
Mortgage Bankers Association, seasonally adjusted data.

14

of households real estate assets. Household equity peaked at $13.3 trillion in the first quarter of
2006.

2.50
2.00
1.50
1.00
0.50
0.00

Foreclosure Inventory

Foreclosure inventory, in millions

5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Q1/1990
Q3/1991
Q1/1993
Q3/1994
Q1/1996
Q3/1997
Q1/1999
Q3/2000
Q1/2002
Q3/2003
Q1/2005
Q3/2006
Q1/2008
Q3/2009
Q1/2011
Q3/2012
Q1/2014
Q3/2015

As percent of mortgages

Mortgage Foreclosure Inventory

As percent of mortgages

Source: Mortgage Bankers Association, downloaded from Haver Analytics

Owner's Equity,
$ bn
14000.000

Household's Owner's Equity in Real Estate

Owner's Equity,
as % of RE assets
80.00

12000.000

70.00

10000.000

60.00
50.00

8000.000

40.00

6000.000

30.00

4000.000

20.00

2000.000

10.00

0.000
Q1/1980
Q1/1982
Q1/1984
Q1/1986
Q1/1988
Q1/1990
Q1/1992
Q1/1994
Q1/1996
Q1/1998
Q1/2000
Q1/2002
Q1/2004
Q1/2006
Q1/2008
Q1/2010
Q1/2012
Q1/2014

0.00

Households: Owners' Equity in Real Estate (NSA, Bil $)

Households: Owners' Equity in Real Estate as a % of Household Real Estate (%)

Source: FRB, Flow of Funds , Table B.101, from Haver Analytics

Cash Sales: 27 Percent of Sales

Approximately 27 percent of sales were all-cash (24 percent in October 2015; 25 percent in
November 2014). Buyers of homes for investment purposes, second homes, and foreign clients
are more likely to pay cash than first-time home buyers. As sales to investors and distressed
properties have fallen, the share of cash sales has declined as well. The share of cash sales to the
15

market has declined compared to the levels in 2010-2014, but the share remains elevated
compared to levels before the housing downturn.
Cash Sales as Percent of Market as of November 2015
40%
35%

27%

30%
25%
20%
15%
10%
5%

201510

201506

201502

201410

201406

201402

201310

201306

201302

201210

201206

201202

201110

201106

201102

201010

201006

201002

200910

200906

200902

200810

0%

Percent of Sales That are All-Cash By Type of Buyer

in November 2015
70%

65%

64%
56%

60%

49%

50%
40%
30%

17%

20%

7%

10%
0%
International

Investor

Second
home

Distressed
sale

Relocation

First-time
buyer

Among financed home purchases, respondents reported that 39 percent made a downpayment of
at least 20 percent, about the same since 2011 when NAR started collecting this data. Among
financed purchases by first-time home buyers, 68 percent had downpayment terms of zero to six
percent, a decrease from 77 percent of first-time buyers in 2009. Low downpayment loans have a
higher monthly mortgage payment and typically require mortgage insurance, but are an option
for home buyers who do not have large savings and are willing to pay the higher monthly
payment. The decreased share of low downpayment loans is one indicator that access to credit
has become more difficult for borrowers who cannot make higher downpayments. In 2015,
16

Fannie Mae and Freddie Mac started purchasing three percent downpayment mortgages of
borrowers who meet underwriting guidelines.
Percent of Mortgage Sales With Downpayment of
At Least 20 Percent as of November 2015
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%

201510

201507

201504

201501

201410

201407

201404

201401

201310

201307

201304

201301

201210

201207

201204

201201

201110

201107

201104

39%

Percent of First-time Buyers Obtaining a Mortgage Who Made

a Downpayment of 0% to 6% as of November 2015*
90%
85%
80%
75%
70%
65%
60%
55%
50%

200906
200909
201002
201005
201008
201011
201102
201105
201108
201111
201202
201205
201208
201211
201302
201305
201308
201311
201402
201405
201408
201411
201502
201505
201508

68%

*The data reported for the month is a rolling three-month figure.

Age, Previous Residence, and Type of Property Purchased

Buyers, 34 years and under, accounted for 26 percent of home sales reported by the respondents.
Buyers, 35 to 55 years old, accounted for half of sales. Buyers, 56 and over, represented 24
percent. Older buyers are likely to purchase homes for investment purposes, as second homes, or
as a trade-down of a primary residence.

17

Age Distribution of Buyers for Sales Reported by REALTOR

Respondents as of November 2015
60%
50%

50%

40%
30%

26%
24%

20%
10%

Age 34 and under

Age 35 to 55

201511

201510

201509

201508

201507

201506

201505

201504

201503

201502

201501

201412

201411

201410

201409

201408

201407

201404

201311

201309

201307

0%

Age 56 and over

Slightly more than half of all reported buyers lived in homes they owned immediately prior to
their recent home purchase. These buyers include trade-up or trade-down buyers and those who
are purchasing a second home or one for investment purpose. Home buyers, who were renting
immediately prior to their recent home purchase, accounted for 35 percent of sales, essentially
unchanged compared to past months.
Living Status of Home Buyers at Time of Home Purchase of
Sales Reported by REALTORS as of November 2015
60%

56%

50%
40%

35%

30%
20%
10%

9%
201511

201510

201509

201508

201507

201506

201505

201504

201503

201502

201501

201412

201411

201410

201409

201408

0%

Rents an apartment or house

Lives in own home
Lives with parents, relatives, or friends

Sales data compiled for the December 2014-November 2015 timeframe showed that among
buyers 34 years and under, 86 percent purchased single-family homes, compared to the 77
percent rate for buyers 56 years and older. Buyers of ages 56 and over are about twice as likely
to purchase a condominium as other buyers. REALTORS have also reported a demand for 55
18

and older community housing as the large baby boomer population continues to move into
retirement.

Type of Residential Property Purchased by Age Group

in January - November 2015
100%
80%

7%
7%

8%
6%

86%

86%

Age 34 and under

Age 35 to 55

17%
7%

10%
6%

77%

84%

Age 56 and over

All

60%
40%
20%
0%

Single-family

Townhome

Condominium

III. Current Issues

Impact of TRID on Contract Settlement
On the impact of the Know Before You Owe/TRID regulations that took effect on October 3,
2015, 47 percent of respondents reported that they are experiencing a longer time to close
compared to a year ago, up from 37 percent in the October 2015 survey.
"In the most recent month, did you observe a longer
time to close compared to your typical closing time in
the same period last year?"

No
53%

Yes
47%

Source: NAR, November 2015 RCI Survey

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The median days to close in November 2015 was 40 days, up from 36 days in July 2015 when
NAR first started collecting this information from the RCI survey.
Median Days to Close

36

201507

35

35

201508

201509

40

40

201510

201511

Contract Settlement Issues: Financing, Home Inspection, and Appraisals are Major Issues
In reporting on their last contract that went into settlement or was terminated over the period
September November 2015, REALTORS reported that 32 percent of contracts had delayed
settlement. The share of delayed contracts appears to be on the rise.

100%
80%

How Sales Contracts Were Settled in

September - November 2015*
9%
26%

10%
26%

9%
28%

7%
29%

6%
29%

7%
29%

6%
30%

7%
29%

6%
32%

65%

64%

63%

63%

65%

65%

64%

64%

62%

60%
40%
20%
0%

Contract was terminated

Contract was delayed but eventually went into settlement
Contract was settled on time
* Based on the most recent contract that went into settlement or was terminated during
this period.

Among contracts that had a delayed settlement (32 percent), 46 percent had financing issues, an
increase compared to the share of about 40 percent in the first half of 2015.

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Problems Encountered for Contracts That Were Delayed But Eventually

Went Into Settlement in September - November 2015
(Delayed Contracts Represent 32 Percent of Closed or Terminated Contracts)
Issues related to obtaining financing
Appraisal issues
Home inspection/environmental issues
Titling/deed issues
Contingencies stated in the contract
Issues in buy/sell distressed property
No problems encountered
Home/hazard/flood insurance issues
Buyer lost job
Other

46%

21%
14%
9%
7%
6%
3%
3%
1%
22%

*Will not sum to 100 percent because multiple responses are allowed. "Other" includes buyer or seller
backing out, price disagreement, non-price disagreement, HOA issues, builder delays, etc.

Among Contracts That Had Delayed Settlement*, Percent of

Contracts with Issues Related to Obtaining Financing
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%

40%

41%

39%

47%

47%

42%

46%

*Accounts for about a third of contracts that went into settlement or were terminated.

Among contracts that were terminated (six percent), 22 percent had financing issues and 22
percent had home inspection issues.

21

Problems Encountered for Contracts That Were Terminated

in September - November 2015
(Terminated Contracts Represent Six Percent of
Closed or Terminated Contracts)
Issues related to obtaining financing
Home inspection/environmental issues
Appraisal issues
Contingencies stated in the contract
No problems encountered
Buyer lost job
Issues in buy/sell distressed property
Titling/deed issues
Home/hazard/flood insurance issues
Other

22%
22%
16%
9%
8%
6%
5%
3%
2%
18%

*Will not sum to 100 percent because multiple responses are allowed. "Other" includes buyer or seller backing
out, price disagreement, non-price disagreement, HOA issues, builder delays, etc.

22

The NATIONAL ASSOCIATION of REALTORS, The Voice for Real Estate, is

Americas largest trade association, representing over 1 million members, including NARs
institutes, societies, and councils, involved in all aspects of the real estate industry. NAR
membership includes brokers, salespeople, property managers, appraisers, counselors and
others engaged in both residential and commercial real estate. The term REALTOR is a
registered collective membership mark that identifies a real estate professional who is a
member of the National Association of REALTORS and subscribes to its strict Code of
Ethics. Working for America's property owners, the National Association provides a facility
for professional development, research, and exchange of information among its members,
and to the public and government for the purpose of preserving the free enterprise system and
the right to own real property.
The Mission of the NATIONAL ASSOCIATION of REALTORS Research Division is to
collect and disseminate timely, accurate, and comprehensive real estate data and to conduct
economic analysis in order to inform and engage members, consumers, policy makers, and
the media in a professional and accessible manner.
To find out about other products from NARs Research Division, visit
www.REALTOR.org/research-and-statistics

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NATIONAL ASSOCIATION of REALTORS

Research Division
500 New Jersey Avenue, NW
Washington, DC 20001
202.383.1000

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