American Confidence in Housing at an All-Time High

American Confidence in Housing at an All-Time High
American Confidence in Housing at an All-Time High | MyKCM

Fannie Mae just released the July edition oftheir Home Purchase SentimentIndex (HPSI). The HPSI takes information regardingconsumers’ confidence in the real estate marketfrom Fannie Mae’s National HousingSurvey and condenses it into a single number.Therefore, the HPSI reflects consumers’ current views andforward-looking expectations of housing market conditions.

Great News! The index reached its highestlevel since Fannie Mae began their survey.Breaking it down, the report revealed:

  • The share of Americans who say it is a good time to buy a homeincreased from the same time last year.
  • The share of those who say it is a good time to sell a homeincreased from the same time last year.
  • The share of Americans who say they are not concerned aboutlosing their job over the next 12 months increased dramatically (16percentage points) from the same time last year.
  • The share of Americans who say mortgage rates will go down overthe next 12 months increased dramatically (24 percentage points)from the same time last year.

The day after the index was released, FreddieMac also announced the 30-year fixed-rate mortgage ratefell to its lowest level in three years.

Doug Duncan, Senior Vice President and ChiefEconomist at Fannie Mae explained theuptick in the index:

“Consumer job confidence and favorable mortgage rateexpectations lifted the HPSI to a new survey high in July, despiteongoing housing supply and affordability challenges. Consumersappear to have shaken off a winter slump in sentiment amid strongincome gains. Therefore, sentiment is positioned to take advantageof any supply that comes to market, particularly in the affordablecategory.”

Bottom Line

Consumers are feeling good about the real estate market. SinceAmericans are not worried about their jobs, see mortgage rates nearan all-time low, and believe it is a good time to buy, the housingmarket will remain strong for the rest of the year.