matter how the results of Fannie Mae's National Housing Survey for May are
interpreted, it is hard to see them as good short terms news for the housing
market. The company says that Americans' concerns about the direction of the economy and their
household income appear to be weighing on housing growth. It is also possible that the results mean
that potential homebuyers see several reasons to return to the wait and see
attitude that helped flatten the market in 2011 and 2012.
According to Fannie Mae,
the share of respondents who still believe the economy is headed in the wrong
direction remained at 57 percent last month while the right track numbers rose
from 35 percent to 38 percent.
"Consumers' lukewarm income expectations and
reticence about the economy seem to be holding back housing demand," said Doug
Duncan, senior vice president and chief economist at Fannie Mae. "This year's
spring and summer home buying season has gotten off to a slow start, even as
mortgage rates have trended lower over the past two months. Our National
Housing Survey data show that economic conditions continue to be the top
concern among consumers who think it's a bad time to buy or sell a home. While
recent housing activity suggests that the worst of the housing slump may be behind
us, this caution among consumers supports our expectation that the rebound in
home sales will likely be too modest to pull sales for all of 2014 ahead of
Or maybe potential homebuyers are
putting plans on hold because they think there might be more opportunities
ahead, most notably in the area of home values.
Prices have risen rapidly since bottoming out in early 2012, and in some
areas such as California this, coupled with higher rates, has dramatically
reduced affordability. In the May survey
the share of respondents who say home prices will go
up in the next 12 months fell to 48 percent, and the share who say home prices
will go down increased to 7 percent. Among those who expect prices to
continue to increase the average increase held steady at 2.9 percent.
the same time the percentage of those who expect further increases in mortgage
interest rates fell from 52 percent to 49 percent. The number looking for lower rates also went
down from 7 to 5 percent while those who expect that rates have stabilized was
unchanged at 38 percent for the third consecutive month.
Those who say it is a good time to buy a house fell slightly to 68
percent, and those who say it is a good time to sell a house increased to 43
percent, a new all-time survey high.
A slight majority of respondents expect rents to increase over the
next year. Just over 50 percent have
expressed that since at least last May but the number who expect rents to
decline rose this month from 43 to 39 percent.
The average 12-month rental price change expectation decreased slightly
to 3.9 percent.
Forty-nine percent of respondents thought it would be easy for
them to get a home mortgage today, rising 4 percentage points from last month. The share who say they would buy if they were going to move
increased slightly to 66 percent.
percentage of respondents who expect their personal financial situation to get
better over the next 12 months fell slightly to 42 percent. The share of respondents who say
their household income is significantly higher than it was 12 months ago
decreased 4 percentage points to 21 percent.
At the same time there did seem to be some improvement in household
finances. The share of respondents who
said their household expenses had declined significantly rose 3 points while
the number who said expenses had risen fell 5 points.
most detailed consumer attitudinal survey of its kind, the Fannie Mae National
Housing Survey polled 1,000 Americans via live telephone interview to assess
their attitudes toward owning and renting a home, home and rental price
changes, homeownership distress, the economy, household finances, and overall
consumer confidence. Homeowners and renters are asked more than 100 questions
used to track attitudinal shifts from month to month dating back to the survey's
origination in June 2010.