Despite low mortgage rates and slowing home price appreciation, consumer confidence in the housing market decreased 2.3 points in September to a score of 91.5 on Fannie Mae’s Home Purchase Sentiment Index (HPSI).
The drop was due mainly to decrease in the number of survey respondents who say they are not concerned about losing their job. This component of the monthly report fell eight percentage points to 69%, continuing the decline seen in August.
In addition, the net share of respondents who say mortgage rates will continue to go down also decreased, indicating that not as many consumers believe mortgage rates will stay low moving forward.
Also, the net share of Americans who say home prices will go up fell seven percentage points to 29%, continuing the decline that started in June.
However, the net share who say it is a good time to buy a home increased three percentage points to 28% – and the net share who say it is a good time to sell rose by four percentage points to 44%.
“Consumer sentiment remains relatively strong overall, though uncertainty about the economy and individual financial circumstances appear to be weighing on housing market attitudes a bit more than a month ago,” says Doug Duncan, senior vice president and chief economist for Fannie Mae, in a release. “Views about the direction of the economy held relatively steady, and the share of respondents who say it’s a good time to buy or sell a home rose slightly.
“However, consumers who are pessimistic about current housing market conditions are more likely to cite unfavorable economic conditions than the prior month,” Duncan adds. “Job confidence remains high but still well shy of its July reading. Despite some added uncertainty, the September HPSI indicates continued strength in housing market attitudes and is consistent with recent data on housing activity.”
The net share of Americans who say their household income is significantly higher than it was 12 months ago remained the same at 21%.