By Leah Draffen | Builder
Consumers’ increased confidence regarding their personal financial situations was largely offset by further negativity toward home buying conditions in July, according to the Fannie Mae Home Purchase Sentiment Index (HPSI). The HPSI increased in July by 0.8 points to 66.8. Month over month, three of the HPSI’s six components increased, including job security and home price expectations, while the full index is up 4 points year over year.
Up from 78% in June, 82% of consumers said it’s a bad time to buy a home, while 18% said it’s a good time to buy, a decrease from 22% in June. Month over month, the net share of those who said it’s a good time to buy decreased 8 percentage points. The percentage who said it’s a good time to sell remained unchanged at 64%, and, likewise, those who said it’s a bad time to sell stayed at 36%.
“Unsurprisingly, consumers continue to attribute the challenging conditions to high home prices and unfavorable mortgage rates. Further, the share of consumers expecting home prices to continue to rise has also been on a steady climb since March, which may only add to perceptions of unaffordability,” says Doug Duncan, Fannie Mae senior vice president and chief economist. “Additionally, we have not seen much movement in the ‘good time to sell’ component over the last few months, an indication that the current low levels of existing homes for sale will likely continue to persist in the near term, as also reflected in our latest forecast.”
