HPSI Archives

More Americans Feel It’s A Good Time To Buy

Despite feeling more pessimistic overall, a recent survey of Americans found that an increasing number said now was a good time to buy a house. Fannie Mae’s Home Purchase Sentiment Index – which tracks consumer attitudes toward buying and selling a home, mortgage rates, wages, home prices, and more – saw a 2 percent increase in the number of respondents who said it was a good time to buy and a 4 percent bump in participants who said it was time to sell. Despite the improvement, the overall index fell for the third straight month. Doug Duncan, Fannie Mae’s senior vice president and chief economist, says uncertainty is taking its toll. “The HPSI fell in October for the third straight month from its record high in July, reaching the lowest level since March. Recent erosion in sentiment likely reflects, in part, enhanced uncertainty facing consumers today,” Duncan said. “Since July, more consumers, on net, have steadily expected mortgage rates to rise and home price appreciation to moderate. Furthermore, consumers’ perception of their income over the past year deteriorated sharply in October to the worst showing since early 2013, weighing on the index. However, this component of the HPSI is volatile from month to month, and the firming trend in wage gains from the October jobs report, if sustained, may foreshadow an improving view in the near future.” More here.

Americans Expect Rates To Rise Next Year

With mortgage rates as low as they’ve been recently, it’s probably not surprising that a growing number of surveyed Americans say they don’t expect them to fall any further over the next 12 months. The survey – Fannie Mae’s monthly Home Purchase Sentiment Index, which tracks consumers’ attitudes toward buying and selling a home, prices, rates, household income, etc – found a 6 percent jump in the number of participants who felt rates would likely be higher next year at this time. Overall, Americans have been in a less optimistic mood since the survey hit its high in July. In fact, among the survey’s major components only the one asking if respondents’ household income is significantly higher than it was 12 months ago saw an increase. Doug Duncan, Fannie Mae’s chief economist, says low inventory, higher prices, and the upcoming presidential election may be causing uncertainty. “The decline in the HPSI over the past two months from the survey-high in July adds a note of caution to our moderately positive housing outlook,” Duncan said. “Downside changes came in particular from the HPSI components mortgage rate direction and good time to buy a house. In addition, the starter home tight supply and rising home prices as well as the unsettled political environment are likely giving many consumers a reason to pause or question their home purchase sentiment.” More here.

More Americans Say It’s A Good Time To Buy

According to Fannie Mae’s August 2016 Home Purchase Sentiment Index, the number of Americans who say it’s a good time to buy a house rose from the month before, marking three straight months of improvement. It’s a sign that an increasing number of potential buyers are feeling secure in their jobs, optimistic about their futures, and eager to take advantage of mortgage rates still near record lows. It also bodes well for the housing market as it nears the end of its busiest season. Overall, the survey found sentiment essentially flat from the month before, when it reached an all-time high. Doug Duncan, Fannie Mae’s senior vice president and chief economist, said Americans are optimistic heading into the fall. “Consumers have a fairly optimistic, 12-month outlook on housing at the end of the summer home-buying season, supported by increased job confidence and more favorable expectations regarding their personal financial situations compared with this time last year,” Duncan said. “The return to a slight upward trend in the HPSI during the spring and summer is, thus far, in line with our forecast, which calls for 4 percent growth in home sales in 2016 to the best level since 2006 and continued improvement for 2017.” More here.

Home Purchase Sentiment Dips In March

Fannie Mae’s Home Purchase Sentiment Index is based on the results of a monthly survey that asks Americans about their attitudes toward buying and selling a home, the economy, their household finances, home prices, mortgage rates, etc. In March, the index dropped 2.5 points from the previous month. This indicates Americans are feeling more cautious about the housing market and less optimistic about their jobs and income. Doug Duncan, Fannie Mae’s senior vice president and chief economist, says Americans’ feelings about the housing market are starting to become affected by pessimism about the overall economy. “Growing pessimism over the last three months about the direction of the economy seems to be spilling over into home purchase sentiment,” Duncan said. “The gap between the share of consumers who think the economy is on the wrong track and the share who think it is on the right track has widened, nearly matching its reading last August, when concerns regarding China and oil prices led to the biggest stock market plunge in years. In turn, we saw dips this month in income growth perceptions, attitudes about the home selling climate, and job confidence, all of which contributed to the lowest HPSI reading in the last year and a half. These declines seem to be at odds with recent news of solid overall job creation, but may reflect weakening economic performance in certain industries.” Still, despite the monthly dip, the index remains virtually unchanged from where it was at the same time last year. More here.