Following two months of sharp declines, buyer foot traffic is trudging back, according to the National Association of REALTORS®’ Diffusion Index.
“This improvement suggests that the year-over-year decline in existing home sales should stabilize in the months ahead, though at a level sharply lower than the spring of 2013,” Ken Fears, NAR’s manager of regional economics and housing finance policy, writes on the Economists’ Outlook blog. “Slower demand will press up on inventories, which are anemic, moderating price growth to a more sustainable pattern to the benefit of consumers.”
The Diffusion Index for foot traffic increased 7.2 points to 26.2 in February. However, a reading below 50 indicates that more than half of the 200 markets measured posted weaker foot traffic in February compared to year-ago levels.
NAR gathers its foot traffic data from SentriLock LLC, which reveals the number of properties shown by a REALTOR®. About a third of home showings across the country use lockboxes made by SentriLock.
According to NAR, foot traffic has a strong correlation to future contracts and home sales.
Source: “Latest Diffusion Index of Foot Traffic,” NAR’s Economists’ Outlook blog (March 10, 2014)