The continued stabilization of consumer attitudes coupled with other positive trends should, according to Fannie Mae analysts, positively influence Americans’ decisions making about buying a home.
“This month’s survey shows a continued gradual improvement in consumer sentiment and outlook for home prices,” says Doug Duncan, vice president and chief economist of Fannie Mae. “After flatlining at depressed levels for over a year, a growing share of consumers indicates that it is a good time to sell, suggesting rising optimism for the housing market.” Duncan adds, however, that an improving real estate market is dependent on growth in jobs, and recent reports have been a bit erratic, suggesting “that the housing recovery will remain uneven this year.”
On average, Americans expect home prices to increase 1.3 percent over the next twelve months, the highest value yet recorded, while the percentage of Americans who say it is a good time to sell their home rose to 15 percent in April.
Confidence in the economy’s direction rose to a survey all-time high in April hitting 37 percent, an increase of 2 percentage points from March. Another positive trend is an increased share of respondents who reported their income as “significantly higher” from twelve months ago, taking it to the highest level recorded over the past year and 7 percentage points higher than those who reported income as “significantly lower.”
Survey highlights
The economy and household finances
• Confidence in the economy’s direction rose to the highest point in the survey’s two-year history to 37 percent, an increase of 2 percentage points from last month.
• Only 12 percent think that their personal financial situation will worsen in the next 12 months, consistent with February and March as the lowest value in more than a year.
• Twenty-three percent of respondents saw an increase in their personal income from 12 months ago, a 2-percentage point increase from March and the highest level recorded during the past year.
• Thirty-six percent say their expenses have increased significantly over the past 12 months, a 2-percentage point increase from last month and a return to the level recorded in January.
Homeownership and renting
• On average, Americans expect home prices to increase by 1.3 percent over the next 12 months, up 0.4 percentage points since last month and the highest value yet recorded.
• Thirty-two percent of respondents expect home prices to increase over the next 12 months, a slight decline from the sharp spike last month.
• Thirty-nine percent of Americans say that mortgage rates will go up in the next 12 months, consistent with last month’s value.
• The percentage of Americans who say it is a good time to buy decreased by 2 percentage points to 71 percent, while the percentage of respondents who say it is a good time to sell continued to increase this month to 15 percent.
• On average, respondents expect home rental prices to increase by 3.6 percent over the next 12 months, a 0.5 percentage point decrease versus last month.
• Forty-nine percent of respondents think that home rental prices will go up, a 1 percentage point increase from last month and the highest number recorded to date.
• Thirty-two percent of respondents say they would rent if they were going to move, a 2-percentage point increase from last month and the highest level since November 2011.
© 2012 Florida Realtors®
