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By G. Steven Bray
Fannie Mae’s Aug housing survey was a bit of downer. The percentage of folks who thinks now is a good time to buy a home dropped another 3 points, and the percentage who thinks now is a good time to sell dropped 5 points. This seems to correlate with industry reports of a slow summer. It also correlates with consumers’ concerns about their personal financial situation and flat income growth.
But if you get past the headlines, the survey results do contain a few positive points that may bode well for the coming year. An increasing share of respondents think rents will rise in the next year, and the expected rate of increase also rose. An increasing percentage also think it would be easy to get a home mortgage. These are people who may be poised to buy a home given an incentive. And that incentive could be rising interest rates. Fifty percent of respondents expect interest rates to fall in the coming year, yet interest rates have been rising, albeit slowly, since the start of Sep. If this trend continues, it might push a few folks off the fence while home affordability is still favorable.
You can find a link to the survey results at the end of my blog.