Fannie Mae supports economic recovery, helps to build sustainable housing finance systems
August 07, 2015. Article by Fannie Mae, the leading source of residential mortgage credit in the U.S. secondary market.
WASHINGTON, DC – Consumer attitudes toward the home selling environment stumbled last month despite positive home price change expectations, according to results from Fannie Mae’s July 2015 National Housing Survey™ (NHS). Among those surveyed, the share of consumers who believe now is a good time to sell a home fell 7 percentage points to 45 percent, while those who believe it is a good time to buy dropped to 61 percent—an all-time survey low. The dip comes as more consumers reported a negative outlook regarding personal finances and the direction of the economy. The share of consumers saying the economy is on the wrong track rose by 3 percentage points to 54 percent in July. Additionally, those who expect their personal financial situation to improve over the next year fell to 44 percent, while those reporting a significantly lower income compared to 12 months ago increased to 15 percent—marking the first change in this indicator in three months.
“Consumer attitudes toward housing slid back this month,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “The share of consumers who think it’s a good time to sell a home posted a sizable decrease from a record high in the prior month, even as home price change expectations strengthened. Deteriorating consumer assessments of income growth over the past year as well as increased caution around the direction of the economy and personal financial expectations may be contributing to the pullback in sentiment. Still, it is premature to read too much into this month’s results as the survey was taken around the time of increased global turmoil, including Greece’s potential default and China’s stock market plunge, which has receded somewhat. Most of our key indicators are as strong or stronger than they were at this time last year, which is indicative of an improving housing market this year.”
Homeownership and Renting
- The average 12-month home price change expectation rose to 3.0%.
- The share of respondents who say home prices will go up in the next 12 months rose to 49%, while the share who say home prices will go down rose to 8%.
- The share of respondents who say mortgage rates will go up in the next 12 months rose 1 percentage point to 51%.
- Those who say it is a good time to buy a house fell to 61% – an all-time survey low, while those who say it is a good time to sell fell to 45%.
- The average 12month rental price change expectation rose to 4.5%.
- The percentage of respondents who expect home rental prices to go up fell 5 percentage points to 54%.
- Those who think it would be easy to get a mortgage fell to 48%, while those who think it would be difficult rose to 49%, the first time that more think it would be difficult since October.
- The share who say they would buy if they were going to move rose 1 percentage point to 65%, while the share who would rent decreased to 28%.
The Economy and Household Finances
- The share of respondents who say the economy is on the right track decreased by 2 percentage points to 37%, while those who say the economy is on the wrong track rose by 3 percentage points to 54%.
- The percentage of respondents who expect their personal financial situation to get better over the next 12 months fell to 44%, ending its rising trend.
- The share of respondents who say their household income is significantly lower than it was 12 months ago rose to 15%, the first change in this statistic since April.
- The percentage of respondents who say their household expenses are significantly higher than they were 12 months ago remained at 31%.
The most detailed consumer attitudinal survey of its kind, Fannie Mae’s 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 (findings are compared to the same survey conducted monthly beginning June 2010). To reflect the growing share of households with a cell phone but no landline, the National Housing Survey has increased its cell phone dialing rate to 60 percent as of October 2014. For more information, please see the Technical Notes. Fannie Mae conducts this survey and shares monthly and quarterly results so that we may help industry partners and market participants target our collective efforts to stabilize the housing market in the near-term, and provide support in the future.
For detailed findings from the July 2015 survey, as well as technical notes on survey methodology and questions asked of respondents associated with each monthly indicator, please visit the Fannie Mae Monthly National Housing Survey page on fanniemae.com. Also available on the site are in-depth topic analyses, which provide a detailed assessment of combined data results from three monthly studies. The July 2015 National Housing Survey was conducted between July 1, 2015 and July 23, 2015. Most of the data collection occurred during the first two weeks of this period. Interviews were conducted by Penn Schoen Berland, in coordination with Fannie Mae.
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Opinions, analyses, estimates, forecasts, and other views of Fannie Mae’s Economic & Strategic Research (ESR) Group included in these materials should not be construed as indicating Fannie Mae’s business prospects or expected results, are based on a number of assumptions, and are subject to change without notice. How this information affects Fannie Mae will depend on many factors. Although the ESR Group bases its opinions, analyses, estimates, forecasts, and other views on information it considers reliable, it does not guarantee that the information provided in these materials is accurate, current, or suitable for any particular purpose. Changes in the assumptions or the information underlying these views could produce materially different results. The analyses, opinions, estimates, forecasts, and other views published by the ESR Group represent the views of that group as of the date indicated and do not necessarily represent the views of Fannie Mae or its management.