Fannie Mae Survey Shows Consumers Well-Attuned to Housing Market

Fed Rate vs Mortgage

Fed Rate vs Mortgage (Photo credit: Wikipedia)

Consumer attitudes are proving consistent with recent slowing housing market trends, indicating that they are well-attuned to the direction in which the housing market is moving. According to the Fannie Mae August 2013 National Housing Survey results, Americans’ outlook on housing growth – which has been trending upward since the beginning of the year – has hit a plateau, likely due to concerns regarding the potential tapering of the Federal Reserve’s asset purchases.

“The spike in mortgage rates associated with the possibility that the Fed will begin to wind down its asset purchase program later this month has dampened the improving trend in consumer sentiment regarding housing witnessed in our survey since the start of this year,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “The pause in positive momentum is consistent with slowing trends in home purchase contract signings and mortgage applications. Interest rate volatility will likely remain elevated, even after we have more clarity on the pace of the Fed’s tapering, due to concerns over the upcoming budget and debt ceiling debates as well as the crisis in Syria.”

Survey data show that consumers expect home prices to continue to grow on average during the next 12 months, but at a slightly reduced pace of 3.4 percent. Additionally, the share who say it is a good time to buy a home has stayed relatively flat during the past year while those who say it is a good time to sell a home has lost momentum recently.

SURVEY HIGHLIGHTS

Homeownership and Renting

  • At 3.4 percent, the average 12-month home price change expectation decreased 0.5 percent from last month’s high.
  • The share of people who say home prices will go up in the next 12 months rose 2 percentage points to 55 percent, while those who say home prices will go down increased slightly from July’s survey low to 7 percent.
  • The share of respondents who say mortgage rates will go up in the next 12 months decreased 2 percentage points from last month’s survey high to 60 percent.
  • The share who say it is a good time to buy a house decreased 3 percentage points to 71 percent, and those who say it is a good time to sell a house fell 4 percentage points to 36 percent.
  • The average 12-month rental price change expectation fell to 4.1 percent, a slight decrease from last month.
  • Fifty-three percent of those surveyed say home rental prices will go up in the next 12 months, a slight decrease from July.
  • Forty-six percent of respondents think it would be easy for them to get a home mortgage today, a slight increase from last month.
  • The share of respondents who said they would buy if they were going to move increased slightly to 65 percent.

The Economy and Household Finances

  • At 37 percent, the share of respondents who say the economy is on the right track decreased 3 percentage points from July.
  • The share of people who expect their personal financial situation to get better over the next 12 months increased slightly to 44 percent.
  • The share of respondents who say their household income is significantly higher than it was 12 months ago fell 3 percentage points from July’s survey high to 23 percent.
  • At 32 percent, the share of respondents who say their household expenses are significantly higher than they were 12 months ago rose 2 percentage points from last month.

Source: Fannie Mae.

 

Follow the Magazine:
https://businessleadershipmanagement.wordpress.com/subscribe-follow-the-magazine/
(After you have filled in your email address in the column at the right hand side of the screen, a confirmation email will sent to your email address. You will have to confirm it before subscription begins)

Follow us on Twitter:
https://twitter.com/BusinessLeaders

Like us on Facebook:
https://www.facebook.com/BusinessLeadershipManagement

**As part of the Magazine’s drive to reward subscribers/followers, we will be providing subscribers/followers special access to exclusive content which will not be otherwise available to normal visitors. Please be sure to subscribe to the Magazine. Many visitors have given us positive comments that they will be bookmarking the site, but as the system is unable to capture a working email address to which the passcodes for exclusive content will be sent, they will miss out on this content. Do note that passcodes are locked to each exclusive content, not a one-for-all access, so do provide a working email address that you check regularly so as not to miss out on them!
Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s