Home Industry News Housing sentiment regains momentum in August

Housing sentiment regains momentum in August

0
Housing sentiment regains momentum in August
istock.com/Phototreat

WASHINGTON —The Fannie Mae Home Purchase Sentiment Index increased 3.3 points in August to 77.5, recovering after falling slightly in July and continuing the rebound from May and June. Five of the six HPSI components of the housing sentiment index increased month over month, with consumers reporting a more optimistic view of both home buying and home-selling conditions, but a slightly more pessimistic view of expected home price growth. Year over year, the HPSI is down 16.3 points.

“The HPSI rose modestly in August, recovering the ground it lost in July,” said Doug Duncan, Senior Vice President and Chief Economist. “The HPSI’s recovery was driven by near-record low mortgage rates that helped restore much of consumers’ positivity on whether it is a good time to buy a home, while also improving the good-time-to-sell sentiment. The August survey was conducted as consumers continue to face uncertainty regarding schools’ and businesses’ reopening plans and as the CARES Act $600-per-week income supplement expired.”

August housing sentiment index highlights

  • Good/Bad Time to Buy: The percentage of respondents who say it is a good time to buy a home increased from 53% to 59%, while the percentage who say it is a bad time to buy decreased from 38% to 35%. As a result, the net share of Americans who say it is a good time to buy increased 9 percentage points.
  • Good/Bad Time to Sell: The percentage of respondents who say it is a good time to sell a home increased from 45% to 48%, while the percentage who say it’s a bad time to sell remained decreased from 48% to 44%. As a result, the net share of those who say it is a good time to sell increased 7 percentage points.
  • Home Price Expectations: The percentage of respondents who say home prices will go up in the next 12 months decreased this month from 35% to 33%, while the percentage who said home prices will go down increased from 23% to 26%. The share who think home prices will stay the same was unchanged at 34%. As a result, the net share of Americans who say home prices will go up decreased 5 percentage points.
  • Mortgage Rate Expectations: The percentage of respondents who say mortgage rates will go down in the next 12 months increased this month from 16% to 17%, while the percentage who expect mortgage rates to go up decreased from 35% to 33%. The share who think mortgage rates will stay the same increased from 42% to 45%. As a result, the net share of Americans who say mortgage rates will go down over the next 12 months increased 3 percentage points.
  • Job Concerns: The percentage of respondents who say they are not concerned about losing their job in the next 12 months increased from 76% to 78%, while the percentage who say they are concerned decreased from 23% to 22%. As a result, the net share of Americans who say they are not concerned about losing their job increased 3 percentage points.
  • Household Income: The percentage of respondents who say their household income is significantly higher than it was 12 months ago increased from 22% to 25%, while the percentage who say their household income is significantly lower was unchanged at 16%. The percentage who say their household income is about the same decreased from 62% to 59%. As a result, the net share of those who say their household income is significantly higher than it was 12 months ago increased 3 percentage points.