Economy is primary concern for pessimistic homebuyersby Marcie Geffner
That’s according to Doug Duncan, chief economist of Fannie Mae in Washington, D.C.
“Rising mortgage rates and a lack of supply have dampened housing market momentum,” Duncan said in a statement. “However, we see several positive signs going into this year’s spring home buying season compared with last year.”
Among those signs: consumers were less pessimistic about their personal finances and more optimistic about the housing market and their ability to get a mortgage, according to Fannie Mae’s latest national housing survey.
Economy on ‘wrong track’
The survey found economic conditions were still the primary concern for people who clung to pessimistic attitudes about housing and most consumers continued to say the U.S. economy was on the wrong track.
“Looking forward,” Duncan said, “we expect to see a pickup in economic growth later in the year, and this may boost the confidence of prospective buyers and sellers.”
A good time to buy
And indeed, consumer attitudes overall continued to move in a positive direction.
The share of survey respondents who said now was a good time to sell a home climbed to 38 percent in March compared with 26 percent a year earlier. The share who believed it would be easy to get a mortgage in March increased to 52 percent, tying the all-time high and up from 47 percent a year ago.
Only 12 percent of respondents said they expected their personal financial situation to get worse during the next 12 months, a significant drop from 21 percent a year earlier. The share who said their personal financial situation had improved during the past year reached an all-time survey high of 40 percent.
Prices, rates to rise
The share of respondents who said home prices would rise in the next 12 months decreased slightly to 48 percent, while the share who said prices would drop decreased to 5 percent, an all-time survey low. Respondents’ average expected home price change for the next 12 months decreased to 2.7 percent.
The share of respondents who said mortgage rates would rise in the next 12 months decreased to 54 percent, while the share who said rates would drop decreased to 3 percent, tying the all-time survey low. Fifty-two percent of respondents thought it would be easy for them to get a home mortgage today, tying the all-time survey high first reached in January.
The survey, conducted via telephone in March, asked 1,000 homeowners and renters more than 100 questions about homeownership, renting, the economy, their personal finances and consumer confidence.