Fannie Mae: Housing Sentiment Dips as High Home Prices Weigh on Buyers

The Fannie Mae Home Purchase Sentiment Index decreased by 1.5 percentage points in July to 88.3, after matching its record high in June.

Fannie Mae attributed the decline to decreases in three of the six HPSI components. The net share of those surveyed who called now a good time to buy a home fell 7 percentage points, while the share who said it’s a bad time to buy reached a new survey high and the share who called it a good time to buy reached a new survey low.

The net share of those who called this a good time to sell a home decreased by 11 percentage points following June’s survey high.

Americans also expressed a greater sense of job security, with the net share who say they are not concerned about losing their job rising by 9 percentage points. Additionally, consumers continued to say their current household income is not significantly higher than it was 12 months ago. Finally, the net share of Americans who expect home prices to go up also increased by 1 percentage point in June, following May’s upward trend.

The decline in selling sentiment was the biggest drag on the index, followed by the drop in buying sentiment. Underlying data showed that economic conditions weighed on the former, Fannie Mae said. Among consumers who called now a bad time to sell, the share citing economic conditions as a primary reason posted a sharp rise. Nearly half of consumers who called now a bad time to buy cited rising prices as a primary concern–a survey high.