Fannie Mae said on Thursday that while the results of its April National Housing Survey showed some improvement in housing sentiment, it was "likely not enough to trigger any breakout improvements in housing market activity this year." Indeed, some of the results showed respondents to be a little conflicted about housing and their choices.
Sixty-three percent of respondents indicated that they would prefer to buy a home at their next move, up from 60 percent in March, but those who said it is now a good time to buy fell by four points to 63 percent. The share of those who thought it is a good time to sell remained stable at 46 percent which is the survey high.
Fannie Mae said the decline in those viewing the present as a good time to buy matched renewed concerns about rising prices and the state of the economy, however the percentage expecting home prices to increase over the next 12 months was down 2 points from March to 46 percent while the average expectation for an increase ticked up from 2.7 percent to 2.8 the highest since last April.
The percentage of respondents who expect interest rates to rise over the next 12 months was unchanged at 52 percent but there was a 3 point increase in those expecting rates to fall. Still only 7 percent held out that hope.
"The spring and summer home buying season has gotten off to a stronger start, reflected in some of the improvement in consumer housing sentiment," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "The share of consumers who intend to own rather than rent their next home rebounded after a two-month slide. Meanwhile, home price growth expectations strengthened to the strongest pace since last October. Nevertheless, consumers continue to express concerns about the recent weakening economic conditions and high home prices. These combine to depress the share of consumers believing it is a good time to buy a home. When we consider both the continued caution of consumers and the positive start to the year, we believe that these results support our expectation that 2015 will be a year of modest growth in housing activity."
Fifty-four percent expect rents to rise over the next 12 months, with an expected increase averaging 2.1 percent, the highest in at least a year.
When it comes to the economy 42 percent now say it is on the right track, a loss of 5 percentage points since it hit a survey high in February. About the same number of respondents expect their own personal financial situation to improve or stay the same over the next year as in March - about 45 percent in each category, but the percentage who expect it to get worse dropped from 14 to 10 percent, a new survey low. Fewer also reported either a decrease in household income over the last year or an increase in household expenses.
Fannie Mae said many of the data points in the April survey mirror Fannie Mae's Home Purchase Sentiment Index which has remained largely flat since last fall, further suggesting that housing growth may remain subdued in 2015. That Index will be released this summer.
The National Housing Survey is conducted monthly by phone among a panel of about 1,000 respondents including renters and homeowners both with and without a mortgage. Respondents are asked over 100 questions 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.