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Overall Housing Confidence Up as Rising Home Prices Influence Increasingly Divergent Home Buying and Selling Sentiment
Monday, September 11, 2017 6:35 AM

Home Purchase Sentiment Index - August 2017

The Fannie Mae Home Purchase Sentiment Index (HPSI) increased 1.2 points in August to 88.0, just below the all-time high set in June. The rise can be attributed primarily to increases in two of the six HPSI components: the good time to sell component and the mortgage rates expectations component.

The net share who reported that now is a good time to sell a home rose 8 percentage points in August and is now up 21 percentage points compared to the same period last year. Meanwhile, the net share who said it's a good time to buy fell 5 percentage points in August and is down 16 percentage points year-over-year. Respondents continue to cite high home prices as the most important reason behind the bad time to buy and good time to sell indicators.

The net share of those who believe mortgage rates will go down increased 4 percentage points, while the net share of Americans who believe home prices will go up increased 1 percentage point. Americans also expressed a reduced sense of job security, with the net share who say they are not concerned about losing their job falling 1 percentage point. Finally, the share of consumers who reported that their income is significantly higher than it was 12 months ago remains unchanged.

"In the early stages of the economic expansion, home selling sentiment trailed home buying sentiment by a significant margin. The reverse is true today," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "The net good time to sell share is now double the net good time to buy share, with record high percentages of consumers citing home prices as the primary reason for both perceptions. Such a sizable gap between selling and buying sentiment, if it persists, could weigh on the housing market through the rest of the year."

HOME PURCHASE SENTIMENT INDEX: COMPONENT HIGHLIGHTS
Fannie Mae's 2017 Home Purchase Sentiment Index (HPSI) increased in August by 1.2 points to 88.0. The HPSI is up 3.0 points compared with the same time last year.

  • The net share of Americans who say it is a good time to buy a home fell 5 percentage points to 18 percent, reaching a new survey low for the second consecutive month, with the share who say it's a bad time to buy and the share who say it's a good time to buy reaching another new survey high and low, respectively.
  • The net percentage of those who say it is a good time to sell increased by 8 percentage points to 36 percent.
  • The net share of Americans who say that home prices will go up increased by 1 percentage point in August to 48 percent, continuing the upward trend this quarter.
  • The net share of those who say mortgage rates will go down over the next twelve months rose 4 percentage points to -45 percent.
  • The net share of Americans who say they are not concerned about losing their job fell by 1 percentage point to 74 percent.
  • The net share of Americans who say their household income is significantly higher than it was 12 months ago remains unchanged from July at 16 percent.

To learn more about Fannie Mae's Home Purchase Sentiment Index and National Housing Survey consumer attitude measures, please click here.