Fannie Mae: Housing Sentiment Surges in Time for Spring

Fannie Mae, Washington, D.C., said its Home Purchase Sentiment Index jumped in March to its highest point since last June.

The Index stands at 89.8, reversing last month’s slight decline. Increases in the “Good Time to Buy” and “Good Time to Sell” components drove the measure of consumer sentiment higher, rising by 7 and 13 percentage points, respectively. Complementing that rise, more consumers on net expect interest rates to fall within the next 12 months, as that component rose 7 percentage points this month.

“A brighter housing market outlook drove this month’s increase in the HPSI–a welcome sign from consumers as we enter the spring and summer home buying seasons,” said Doug Duncan, senior vice president and chief economist with Fannie Mae. “The results further corroborate the positive effect of falling mortgage rates on affordability, which we expect will help support a rebound in home sales.”

Additionally, Duncan said, “consumers appear to have regained some confidence in the housing market, with perceptions of both home buying and home selling conditions returning to their longer-term trends.”

Other report highlights:

The overall index rose by 1.5 points from a year ago.

–The net share of Americans who say it is a good time to buy a home increased to 22%, but remains down by 10 percentage points from a year ago.

–The net share of those who say it is a good time to sell a home increased by 13 percentage points to 43% and improved by 4 percentage points from a year ago.

–The net share of those who say home prices will go up increased 5 percentage points to 38% but fell by 4 percent from a year ago.

–Americans who say mortgage rates will go down over the next 12 months increased by 7 percentage points to 45% and increased by 7 percent from a year ago.

–Americans who say they are not concerned about losing their job decreased 1 percentage point to 80% but rose by 9 percent from a year ago.

–The net share of those who say their household income is significantly higher than it was 12 months ago increased 2 percentage points to 20% and rose by 3 percent from a year ago.