After closing to its narrowest margin in survey history in October the gulf between people who think the current market it a good one for buyers and/or good for sellers widened appreciably in November. Fannie Mae said that 68 percent of respondents to its National Housing Survey last month viewed it as a good time to buy, up 3 percentage points from last month, while those who thought it a good time to sell fell 5 points to 39 percent.
This and other results from the survey, Fannie Mae says, track closely with the uneven 2014 housing market trend which is improving but lagging the overall economy. The survey found Americans’ personal financial outlook has increased fairly steadily during the year, lending supported to the housing recovery and the numbers who expect mortgage rates to go up over the next year decreased 3 points to 45 percent with a commensurate increase in those who expect no change. The company said the expectation that rates would increase has been on a gradual but uneven decline since the beginning of the year.
"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."
Only 44 percent of survey respondents expect further home price increases over the next 12 months, a percentage that has remained virtually unchanged since late summer. However, among those who do expect an increase the average they expect fell 2 basis points to 2.6 percent in the November survey. There is a strong expectation that rents will increase; 53 percent of respondents think so, up from 49 percent in October although the average increase fell from 3.7 to 3.6 percent.
The percentage of consumers who think it would be difficult for them to obtain a mortgage dropped from 50 to 47 percent although those who thought it would be easy remained at 48 percent. Still, when asked whether they would buy or rent their next home there was a decline among those who would buy of 3 points, to 61 percent. Those who would opt to rent went from 30 to 31 percent.
The National Housing Survey polls 1,000 Americans by phone each month. Respondents are asked 100 questions 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. The survey panel includes renters and homeowners both with and without mortgages.