National Housing Survey Results Mirror Uneven 2014 Activity

Katie Penote

202-752-2261

WASHINGTON, DC – Results from Fannie Mae's November 2014 National Housing Survey show that Americans' attitudes toward housing have tracked closely with the uneven 2014 housing market trend, which is improving but lagging behind the overall economy trend. According to the survey results, consumers' personal financial outlook has increased fairly steadily during the year, lending support to the ongoing housing market recovery. The share of respondents who expect mortgage rates to go up in the next 12 months decreased again to 45 percent, in line with a gradual but uneven decline since the beginning of the year. On the other hand, the share who believe it is a good time to buy and sell a home moved further apart. Sixty-eight percent of consumers now say it is a good time buy, an increase of 3 percentage points, compared to 39 percent who say it is a good time to sell, a 5 percentage point drop.

"November’s National Housing Survey results support the 2014 trend of gradual, but often sporadic and unspectacular, improvement across a range of indicators measuring consumer attitudes toward housing – mirroring the uneven recovery in housing activity this year," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "More encouraging is the steady upward trend this year in consumers' assessment of their personal finances, with 46 percent of Americans – near the survey's high – expecting their personal financial situation to improve over the next 12 months. We expect consumer attitudes toward housing to improve as the pickup in the overall economy lifts employment and income prospects. However, a sustained improvement in sentiment that could support a robust housing recovery, as policy support is removed, will require meaningful gains in household income. While such gains have so far been elusive, the strength in the November jobs report, which points to faster growth in labor income in the current quarter, marks a good start."

SURVEY HIGHLIGHTS

Homeownership and Renting

• The average 12-month home price change expectation fell to 2.6 percent.
• The share of respondents who say home prices will go up in the next 12 months remained at 44 percent. The share who say home prices will go down decreased to 6 percent.
• The share of respondents who say mortgage rates will go up in the next 12 months fell by 3 percentage points to 45 percent.
• Those who say it is a good time to buy a house rose to 68 percent. Those who say it is a good time to sell fell by 5 percentage points to 39 percent.
• The average 12-month rental price change expectation fell to 3.6 percent.
• The percentage of respondents who expect home rental prices to go up in the next 12 months increased by 4 percentage points to 53 percent.
• The share of respondents who think it would be difficult to get a home mortgage today decreased by 3 percentage points.
• The share who say they would buy if they were going to move fell to 62 percent, while the share who would rent increased to 31 percent.

The Economy and Household Finances

• The share of respondents who say the economy is on the right track fell 4 percentage points to 36 percent.
• The percentage of respondents who expect their personal financial situation to get better over the next 12 months increased to 46 percent.
• The share of respondents who say their household income is significantly higher than it was 12 months ago remained at 25 percent.
• The share of respondents who say their household expenses are significantly higher than they were 12 months remained at 36 percent.

The most detailed consumer attitudinal survey of its kind, the Fannie Mae National Housing Survey polled 1,000 Americans via live telephone interview to assess their attitudes toward owning and renting a home, home and rental price changes, homeownership distress, the economy, household finances, and overall consumer confidence. Homeowners and renters are asked more than 100 questions used to track attitudinal shifts (findings are compared to the same survey conducted monthly beginning June 2010). To reflect the growing share of households with a cell phone but no landline, the National Housing Survey has increased its cell phone dialing rate to 60 percent as of October 2014. For more information, please see the Technical Notes. Fannie Mae conducts this survey and shares monthly and quarterly results so that we may help industry partners and market participants target our collective efforts to stabilize the housing market in the near-term, and provide support in the future.

For detailed findings from the November 2014 survey, as well as a podcast providing an audio synopsis of the survey results and technical notes on survey methodology and questions asked of respondents associated with each monthly indicator, please visit the Fannie Mae Monthly National Housing Survey page on fanniemae.com. Also available on the site are in-depth topic analyses, which provide a detailed assessment of combined data results from three monthly studies. The November 2014 Fannie Mae National Housing Survey was conducted between November 1, 2014 and November 17, 2014. Most of the data collection occurred during the first two weeks of this period. Interviews were conducted by Penn Schoen Berland, in coordination with Fannie Mae.