Consumer Sentiment on Housing Dips Slightly Despite Growing Labor Market Optimism

The Fannie Mae Home Purchase Sentiment Index® (HPSI) decreased in February by 1.2 points to 76.5. Four of the HPSI’s six components fell month over month, including most notably the homebuying conditions and household income components. Offsetting much of that decline, however, was increased optimism regarding job security, with consumers reporting a significantly more positive view of the labor market compared to January. Year over year, the HPSI is down 16.0 points.

“As we expected, the HPSI remained relatively flat in February, but underlying data indicate growing job-related optimism among consumers, especially among lower-income and renter groups,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. “With the growing likelihood that lockdown restrictions will continue easing as vaccination efforts ramp up, and with warmer weather on the horizon and another round of fiscal stimulus pending, these two segments of consumers may have good reason to feel more positive about the labor market. This optimism appears to be well-placed, too, given Friday's jobs report from the Bureau of Labor Statistics, which showed the strongest net gain in payroll employment since October, although the unemployment rate remains quite high by historical standards. However, other components of the index remain well below pre-pandemic levels, so we believe there may still be room for improvement in housing and economic attitudes in the coming months, depending in part on the future path of mortgage rates.”

Downloads and Related Links
February 2021 News Release
February 2021 National Housing Survey Data Release  

National Housing Survey Monthly Indicators Archive
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