Americans' Optimism about Buying and Selling a Home Hits Record Levels
Americans’ confidence in their ability to buy and sell a home climbed sharply in May, likely due to reports of strong home price gains, according to results from Fannie Mae’s May 2013 National Housing Survey. The share of respondents who say now is a good time to sell a home reached a record high of 40 percent, compared to 30 percent in April and 16 percent one year ago. At the same time, the share of those who say it is a good time to buy a home moved up 5 percentage points from April to a survey high of 76 percent. Americans’ average 12-month home price change expectation also reached a survey high in May, climbing to 3.9 percent from 2.7 percent in April.
“Sentiment toward selling a home appears to be catching up with the strengthening housing market,” says Doug Duncan, senior vice president and chief economist at Fannie Mae. “The share of consumers who think it’s a good time to sell a home spiked this month, the largest increase in the survey’s three-year history. This jump may foreshadow a gradual return to more normal levels of housing supply from their lows of recent months. In turn, increased housing supply could serve to temper increasing consumer home price expectations. We will closely watch the potential impact of rising mortgage rates on consumer housing sentiment in the coming months.”
Currently, 46 percent of Americans think it would be easy for them to get a mortgage today, retreating slightly from April’s survey high, while 50 percent believe it would be difficult to get a mortgage. Consumers have been asked since the survey’s inception in June 2010 for their perceived ease or difficulty in getting a mortgage, and the question was added in May 2013 as an indicator to the monthly data findings report to help determine whether rising mortgage rates affect their views.
Homeownership and Renting
- The average 12-month home price change expectation jumped to 3.9 percent, the highest level since the survey’s inception.
- The share of people who say home prices will go up in the next 12 months hit a survey high of 55 percent, while those who say home prices will go down dropped to 7 percent, the lowest level since the survey’s inception.
- The share of respondents who say mortgage rates will go up increased 3 percentage points to 46 percent, while those who say rates will go down hit a survey low of 5 percent.
- At 76 percent and 40 percent, respectively, the shares who say it is a good time to buy a house and who say it is a good time to sell a house both reached survey highs.
- The average 12-month rental price change expectation dropped to 3.4 percent, the lowest level since September 2012.
- Holding steady from last month, 48 percent of those surveyed say home rental prices will go up in the next 12 months.
- Retreating slightly from last month’s survey high, 46 percent of respondents think it would be easy for them to get a home mortgage today.
- The share of respondents who said they would buy if they were going to move increased slightly to 66 percent.
The Economy and Household Finances
- At 40 percent, the share of respondents who say the economy is on the right track increased slightly from April.
- The percentage of people who expect their personal financial situation to get better over the next 12 months held steady at 41 percent.
- The share of respondents who say their household income is significantly lower than it was 12 months ago fell 3 percentage points to a survey low 13 percent.
- The percentage of respondents who say their household expenses are significantly higher than they were 12 months ago rose slightly to 32 percent.
For more information, visit http://www.fanniemae.com/progress.
Reprinted with permission from RISMedia. ©2013. All rights reserved.