Fannie Mae: Housing Sentiment Flat in April

(Image courtesy of Fannie Mae; courtesy of Erik Mclean/pexels.com)

Fannie Mae’s latest Home Purchase Sentiment Index was flat in April, at 71.9.

Fannie Mae said it’s showing signs of plateauing amid the higher interest rates and status of home prices.

However, in April, 67% of consumers said that it’s a “good time” to sell a home–up 10 percentage points from the end of 2023. And, 20% said it’s “good time” to buy a home, up 3 percentage points since the end of 2023.

The share of respondents who expect mortgage rates to go down over the next year fell to 26%.

“The HPSI, unchanged this month, may have hit another plateau as consumers maintain their ‘wait and see’ approach to the housing market,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. “Overall, housing sentiment increased from November through February, driven largely by consumer belief that mortgage rates would move lower. However, recent data showing stickier-than-expected inflation, rising mortgage rates and continued home price appreciation appears to have given consumers pause regarding the market’s direction.”

Looking forward, the sentiment does bode well for listings and housing activity, especially for buyers who do need to move for various reasons and have accepted the current market, noted Duncan. “However, for potential homebuyers in less of a rush to transact, ongoing affordability challenges may continue to keep many of them on the sidelines–one reason why we expect home sales to tick up only gradually over the course of the year,” he continued.

The full index is up 5.1 points year-over-year.