The Housing Headline
U.S. consumers think housing will be stronger next year, and that home prices will be higher.
The News Behind The Housing Headline
Every month, government mortgage agency Fannie Mae surveys 1,000 U.S. consumers at random. The survey responses are compiled into the Home Purchase Sentiment Index which gauges how everything Americans feel about housing.
The most recent release shows home buyers bullish on housing. Just 8% expect home prices to drop, and more than half expect their financial situation to improve over the next 12 months.
92% of consumers think mortgage rates have hit bottom.
Why This Housing News Matters To You
The Fannie Mae report is loaded with data, and none of it’s particularly helpful. The report is a collections of opinions from the public, and the public is typically wrong in its predictions.
There’s one survey question worth watching, though, because it affects how other consumers behave: “In the next 12 months, do you expect your personal financial situation to improve, get worse, or stay the same?”
People who feel good about their finances are more likely to switch from renting to buying, and that builds demand that raises home prices. Only 11% of consumers think their finances will worsen between now and next year, so expect additional upward pressure on listing prices for homes.
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Today’s home buyers have 8 percent more purchasing power, and they’re asking mortgage lenders to approve more mortgage applications.