Americans responding to the Fannie Mae's
September edition of its National Housing Survey displayed greater optimism
about the housing market, homeownership, and the country's economy in
general. Fannie Mae said that there has
been a gradual improvement in attitudes about housing over the last few months
but consumer attitudes about the economy as a whole improved substantially in
the most recent survey, "breaking the progression of waning confidence seen during
much of this year."
"Consumers are showing increasing faith in the
nascent housing recovery," said Doug Duncan, senior vice president and chief
economist of Fannie Mae. "Home price change expectations have remained positive
for 11 straight months, and the share expecting home price declines has
stabilized at a survey low of only 11 percent. Furthermore, the Federal Reserve's
latest round of quantitative easing has caused a large drop in mortgage rate
expectations. Friday's September jobs report, including the strong upward
revisions for prior months, a sizable increase in earnings, and a sharp decline
in the unemployment rate, should provide further impetus for improving consumer
confidence in the housing market."
Fannie Mae's survey polls 1,000
individuals by phone each month. The survey
includes homeowners with and without a mortgage on their homes and renters. Respondents are asked more than 100 questions which
are used to track attitudinal shifts.
The survey has been conducted since June 2010,
The percentage of respondents who
expect home prices to rise over the next year is now at 37 percent, up from 18
percent one year ago and the highest level in the survey's short history. Only 11 percent think prices will experience
further declines. The average increase
expected by respondents is 1.5 percent, down slightly from each of the previous
two months but the 11th straight month that price change
expectations have been in positive territory.
Half of respondents expect mortgage
rates to remain unchanged over the next 12 months - an increase of 3 percentage
points from August while the percentage expecting rates to rise declined from
40 to 33 percent.
Seventy-two percent of respondents
view this as a good time to buy a home, a number that has risen only four
points over the last year. However, the
percentage who view the present as a good time to sell has risen 9 points to 19
percent in the same time frame. Tying
the June 2012 level for the all-time high, 69 percent of participants said they
would buy if they were going to move.
Rental prices are expected to
increase by 47 percent of those responding with an average increase of 3.1
percent. Price increase expectations
have moderated a bit since early summer when respondents were looking for
increases averaging 3.9 percent.
Consumer confidence was way up; 41
percent now believe the economy is on the right track, up from 33 percent last
month. The percent who believe the
direction is wrong dropped from 60 percent to 53 percent. These are, respectively, the highest and
lowest readings in the survey's history.
When it came to personal financing,
44 percent responded that they expected their own situation to improve over the
next year, up from 42 percent the previous month. At the same time, the percentage that
reported they actually had a higher household income than one year earlier
declined from 20 percent to 17 percent and the percent saying their household
expenses are higher than a year ago rose 2 percent to 34 percent month-over-month.