Government-sponsored enterprise Fannie Mae's July National Housing Survey shows that rising interest rates are not deterring consumers from borrowing for home purchases.
The monthly attitudinal survey of 1,000 American adults shows that 62% believe interest rates will go up over the next year, an increase of five percentage points compared to June's survey. In addition, 53% expect home prices to climb over the next year, a slight increase over June's high.
Despite this, 74% of respondents said now is a good time to buy a house, up slightly from the previous month. Only 40% said now is a good time to sell a house, an increase of four percentage points.
The percentage of respondents who said home prices will go up over the next year fell to four percentage points from June's survey high, while those who say home prices will go down reached a survey low of 6%.
In addition, 54% of those surveyed say home rental prices will go up in the next 12 months, a decrease of two percentage points from June's survey high.
Forty-five percent of respondents said they thought it would be easy for them to get a home mortgage, a decrease of two percentage points compared to the previous month.
‘Consumers have taken the interest rate rise in stride,’ said Doug Duncan, senior vice president and chief economist at Fannie Mae. ‘Expectations for continued improvement in housing persist and sentiment toward the current buying and selling environment is back on track from its dip last month. These results are consistent with our own analysis of previous housing cycles, which finds that interest rates and home prices are not strongly correlated.’
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