Press release from PR Newswire
Consumers Tip Scales of Home Price Change Expectations
Tuesday, May 07, 2013
Consumers Tip Scales of Home Price Change Expectations09:00 EDT Tuesday, May 07, 2013
Majority Now Believe Prices Will Climb in Next 12 Months
WASHINGTON, May 7, 2013 /PRNewswire/ -- More than half of Americans now expect the country's home prices to climb within the next year, illustrating a growing optimism toward the health of the housing industry. The share of respondents to Fannie Mae's April 2013 National Housing Survey results who expect home prices to go up rose another 3 percentage points in April to 51 percent. By comparison, at the same time last year only 32 percent expected an increase in home prices.
"For the first time in the survey's three-year history, the majority of Americans surveyed now expect home prices to increase," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "Crossing the 50 percent threshold marks a significant milestone as most Americans believe a housing recovery is truly occurring throughout the country. Reflecting that increased optimism toward housing, the share of Americans who think it is a good time to sell has doubled during the last year. Many homeowners who have been underwater are gradually returning to positive equity, and selling is now becoming an available and attractive option again."
The share of respondents who say now is a good time to sell climbed 4 percentage points in April to 30 percent, compared to 15 percent at the same time last year. Americans' increasing optimism toward the selling market may bode well for continued improvement in housing activity, as recent market data suggest that five out of eight people who buy a home first have to sell.
SURVEY HIGHLIGHTSHomeownership and Renting
- The average 12-month home price change expectation held steady at 2.7 percent.
- The share of people who say home prices will go up in the next 12 months hit a survey high of 51 percent, while those you believe home prices will go down remained at the survey low of 10 percent for the fourth month in a row.
- The share of respondents who say mortgage rates will go up fell 3 percentage points to 43 percent, while those who say they will go down increased slightly to 7 percent.
- At a survey-high 30 percent, the share of respondents who say it is a good time to sell a house increased 4 percentage points over March.
- The average 12-month rental price change expectation held steady at 4.1 percent.
- Forty-eight percent of those surveyed say home rental prices will go up in the next year, a 2 percentage point decrease from last month's survey high.
- The share of respondents who said they would buy if they were going to move increased slightly to 65 percent.
The Economy and Household Finances
- At 39 percent, the share of respondents who say the economy is on the right track increased 4 percentage points over March.
- The percentage of people who expect their personal financial situation to get worse over the next 12 months fell 5 percentage points to 16 percent.
- Twenty percent of respondents say their household income is significantly higher than it was 12 months ago, holding steady from last month.
- Eleven percent reported significantly lower household expenses compared to 12 months ago, a 3 percentage point increase over March.
The most detailed consumer attitudinal survey of its kind, the Fannie Mae National Housing Survey polled 1,001 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). 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 April 2013 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 site. Also available on the site are in-depth topic analyses, which provide a detailed assessment of combined data results from three monthly studies. The April 2013 Fannie Mae National Housing Survey was conducted between April 1, 2013 and April 21, 2013. 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.
Opinions, analyses, estimates, forecasts, and other views of Fannie Mae's Economic & Strategic Research (ESR) Group included in these materials should not be construed as indicating Fannie Mae's business prospects or expected results, are based on a number of assumptions, and are subject to change without notice. How this information affects Fannie Mae will depend on many factors. Although the ESR Group bases its opinions, analyses, estimates, forecasts, and other views on information it considers reliable, it does not guarantee that the information provided in these materials is accurate, current, or suitable for any particular purpose. Changes in the assumptions or the information underlying these views could produce materially different results. The analyses, opinions, estimates, forecasts, and other views published by the ESR Group represent the views of that group as of the date indicated and do not necessarily represent the views of Fannie Mae or its management.
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SOURCE Fannie Mae
For further information: Pete Bakel, 202-752-2034