Housing confidence holds steady despite financial concerns in Fannie Mae monthly survey

Most housing indicators remained steady and positive in Fannie Mae's latest monthly survey gauging attitudes toward the real estate market and economy. However, people were also more likely to express concerns about their employment or mortgage rates.

The Home Purchase Sentiment Index for September stood at 91.5, down 2.3 points from a record high in August but a yearover-year gain of 3.8 points. The index is based on six factors from Fannie Mae's National Housing Survey, including whether respondents consider it a good time to buy or sell a home, expected changes to home prices and mortgage rates, job confidence, and changes to household income over the past 12 months.

"Consumer sentiment remains relatively strong overall, though uncertainty about the economy and individual financial circumstances appear to be weighing on housing market attitudes a bit more than a month ago," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "Views about the direction of the economy held relatively steady, and the share of respondents who say it's a good time to buy or sell a home rose slightly. However, consumers who are pessimistic about current housing market conditions are more likely to cite unfavorable economic conditions than the prior month. Job confidence remains high but still well shy of its July reading. Despite some added uncertainty, the September HPSI indicates continued strength in housing market attitudes and is consistent with recent data on housing activity."

Fifty-nine percent of respondents considered it a good time to buy a home, inching up 1 percentage point from both the previous month and previous year. Thirty-one percent thought it was a bad time to buy, down 2 percentage points from August and 1 percentage point from September 2018.

Fifty-nine percent said they thought it would be easy for them to get a mortgage, down 3 percentage points from the previous month but up 3 percentage points from the previous year. Thirty-seven percent said they thought it would be difficult to get a mortgage, up 1 percentage point from August but down 4 percentage points from September 2018.

Thirty-eight percent said they expect mortgage rates to increase in the next 12 months – up 5 percentage points from the previous month but down from 60 percent in September 2018. Fifteen percent said they think rates will decrease, down 1 percentage point from August but a year-over-year increase of 11 percentage points.

Sixty-nine percent said they would buy their next home if they were to move, up 3 percentage points from both the previous month and previous year. The share indicating that they would rent their next home if they were to move fell from 30 percent in September 2018 and 29 percent in August to 27 percent.

Fifty-six percent said they think home rental prices will go up in the next 12 months, down 3 percentage points from both the previous month and previous year. Four percent said they think rental prices will go down, up from 3 percent in August and 2 percent in September 2018. On average, respondents expected that rental prices will grow 4.2 percent in the next 12 months – down from 4.6 percent in the previous month and 4.5 percent in the previous year.

Sixty-seven percent said they thought it was a good time to sell a home, up 2 percentage points from August and 3 percentage points from September 2018. Twenty-three percent thought it was a bad time to sell, down from 25 percent in the previous month and 26 percent in the previous year.

The net share of respondents expecting home prices to appreciate over the next 12 months has been slowly decreasing since May. Forty-three percent said they expect prices to go up, down 4 percentage points from August and 6 percentage points from September 2018. Fourteen percent said they think prices will go down, up 3 percentage points from the previous month and 4 percentage points from the previous year. On average, respondents expected home prices to grow 1.7 percent in the next 12 months – down from 2.4 percent in August and 2.6 percent in September 2018.

While a net share of 81 percent of respondents said they weren't concerned about losing their job in July, it fell to 69 percent in September. Eighty-four percent said they weren't concerned about losing their job in the next 12 months, down from 88 percent in August and 89 percent in September 2018. Fifteen percent said they were worried about potential unemployment, up 4 percentage points from the previous month and 5 percentage points from the previous year.

Thirty-one percent said their household income is significantly higher than it was 12 months ago, unchanged from the previous month and up 3 percentage points from September 2018. Ten percent said their income is significantly lower, also unchanged from the previous month but up 1 percentage point from September 2018.

Forty-eight percent said they think their personal financial situation will get better over the next 12 months, down from 49 percent in the previous month and 53 percent in the previous year. Nine percent said they expect their personal financial situation to get worse, down 1 percentage point from the previous month but up 1 percentage point from the previous year.

Fifty-one percent said they believe the U.S. economy is on the right track, up 1 percentage point from August but down 4 percentage points from September 2018. Forty percent said they think the economy is on the wrong track, down 1 percentage point from the previous month but a year-overyear increase of 6 percentage points.

Fannie Mae's National Housing Survey is based on telephone interviews with approximately 1,000 Americans each month. Respondents are asked more than 100 questions about the housing market and economy.