Consumers are increasingly upbeat about housing, but their concerns about the economy and stagnant income growth are keeping a lid on home sales, according to Fannie Mae’s May 2014 National Housing Survey.
The share of consumers who believe the economy is headed in the wrong direction stayed flat at 57 percent last month, while those who said their household income is significantly higher than it was last year fell 4 percentage points to 21 percent.
“While recent housing activity suggests that the worst of the housing slump may be behind us, this caution among consumers supports our expectation that the rebound in home sales will likely be too modest to pull sales for all of 2014 ahead of last year,” said Doug Duncan, senior vice president and chief economist at Fannie Mae, in a statement.
Home sales have mostly trended downwards this year, though they’ve shown signs of stabilizing in the last month or so.
The survey suggests that Americans continue to take a more positive view of the housing market than the economy or their personal finances.
The share of respondents who say it’s a good time to sell a house increased to 43 percent, the highest level recorded since the survey’s inception in 2010, and the share of those who say it’s a good time to buy dropped slightly to 68 percent.
The survey also found that:
- The average 12-month home price change expectation remained unchanged from last month, at 2.9 percent.
- The share of respondents who say home prices will go up in the next 12 months fell to 48 percent, while the share who say home prices will go down increased to 7 percent.
- The share of respondents who say mortgage rates will go up in the next 12 months continued to fall, dropping to 49 percent.
- The average 12-month rental price change expectation decreased slightly to 3.9 percent.
- Fifty-one percent of those surveyed said home rental prices will go up in the next 12 months, while 3 percent of respondents said rental prices will fall.
- Forty-nine percent of respondents thought it would be easy for them to get a home mortgage today, rising 4 percentage points from last month.
- The share who say they would buy if they were going to move increased slightly to 66 percent.