Cautious Consumers Stalling Housing Momentum
Positive momentum in the housing market continues to lose steam as Americans remain cautious about their personal finances and the state of the economy, according to Fannie Mae’s November National Housing Survey results. Among those surveyed, nearly two-thirds believe the economy is on the wrong track while the share expecting their personal finances to worsen during the next year has increased during the past few months to 22 percent. Meanwhile, consumers’ home price expectations have declined steadily since summer. The share who say prices are going to increase within the next 12 months fell to 45 percent and the average home price change expectation dipped to 2.5 percent from 2.9 percent. In addition, the share of those who expect mortgage rates to climb in the next 12 months has remained at an elevated level since it spiked in June.
"We continue to see caution as the defining feature of Americans’ attitudes toward the economy and their personal financial situation. In this environment, the housing recovery is likely to improve, but only at a gradual pace,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Our November National Housing Survey results show a loss of momentum in expectations for home prices and personal finances. Also, the majority of consumers expecting higher mortgage rates implies a slowing of housing market momentum. As the economy continues to improve and household balance sheets for most Americans are slow to repair, we continue to see the transition to a full housing recovery as a slow process. Upcoming fiscal policy discussions and labor market developments may also lead to some bumps along the way."
Fannie Mae's monthly national consumer attitudinal survey report provides indicators offering a window into the opinions of Americans across the country. These behavioral insights convey what consumers think about the outlook for owning and renting a home and about their household finances, and may serve as key inputs for determining the future course of investment across housing types.
On this webpage you will find a news release with highlights from the survey results, the November Data Release highlighting 12 consumer attitudinal indicators, a podcast containing highlights from this month’s survey, technical notes providing in-depth information about the survey methodology, the questionnaire used for the survey, and a comparative assessment of the Fannie Mae National Housing Survey and other consumer surveys.
Downloads and Related Links
November 2013 National Housing Survey Data Release (PDF)
Podcast – November National Housing Survey (.mp3)
Click here for an archived list of Fannie Mae's National Housing Survey Monthly Indicators.