WASHINGTON—A new study shows consumer optimism toward the housing market gained some momentum last month, following a dip in December.
Fannie Mae's January 2015 National Housing Survey indicates consumers’ positive outlook is likely from their increasingly positive financial outlook. The study polled 1,000 Americans via live telephone interviews to assess their attitudes toward owning and renting a home, home and rental price changes.
The share of respondents who said their household income is significantly higher than it was 12 months ago rose four percentage points to 29%, and the share expecting their personal financial situation to improve over the next year increased to 48% – both all-time survey highs.
After dropping in December, the share who said it is a good time to buy a home increased three percentage points to 67%, and the share saying they would buy rather than rent if they were to move jumped five percentage points to 66%, marking the first increase since September 2014.
"Consumers are as positive about their personal finances at the start of 2015 as they have been since we launched the National Housing Survey in 2010, and this optimism seems to be spilling over into housing market attitudes," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "Consumers are more optimistic about the environment both for buying and for selling a home today, and the share who plan to own on their next move has jumped back up, reversing a three-month trend toward renting.”
The results are in line with lender optimism about future growth in their mortgage origination business, as shown in Fannie Mae’s Mortgage Lender Sentiment Survey, Duncan added.
“Overall, these are good signs to start off 2015 and are consistent with our expectation that strengthening employment and economic activity will boost the speed of the housing recovery."
Other survey highlights:
- The average 12-month home price change expectation rose to 2.5%.
- The share of respondents who say home prices will go up in the next 12 months rose to 49%. The share who say home prices will go down remained constant at 8%.
- The share of respondents who say mortgage rates will go up in the next 12 months decreased by three percentage points to 45%.
- Those who say it is a good time to sell a home increased to 44%—tying an all-time survey high.
- The average 12-month rental price change expectation decreased to 3.6%.
- The percentage of respondents who expect home rental prices to go up in the next 12 months fell slightly to 52%.