How Consumer Attitudes Could Affect Housing
A Fannie Mae survey suggests improved customer attitudes and economic expectations are key to how the mortgage marketplace will look like in 2013.
Fannie Mae's November 2012 National Housing Survey found borrower attitudes about the current buying and selling environment continue to improve.
Fifty-one percent of respondents said going forward it would be easy to get a mortgage, the highest rate since Fannie started the survey in June 2010.
It is one of the survey indicators, many of which now are “at or near their two-and-a-half-year highs," according to Fannie’s senior vice president and chief economist, Doug Duncan.
The share of respondents who say now is a good time to sell a home jumped 5 percentage points in November to 23%, also marking the highest level since June 2010.
In other words, the gap between sellers and buyers continues to close.
Meanwhile, the share of respondents who are interested in buying if they move remains relatively steady at 67%.
Duncan argues that since Americans’ increased confidence in the housing market and the direction of the economy appears not tampered by the fiscal cliff uncertainty, so if the sentiment prevails in 2013 it is likely to help “gather momentum” in support of overall economic growth.
Both the number of those who think mortgage rates will go up and those who think it will go down increased by 4 percentage points in November to 41% and 14%, respectively.
Other expectations about renting have changed only slightly if at all as 48% of those surveyed see home rental prices going up in the next 12 months, marking a slight decrease from last month.
The change in the overall attitude is not overwhelming.
The number of those indicating that the economy is on the right track has risen to 44% compared to 50% for those who believe the economy is on the wrong track.
So even though the current ratio represents “the smallest gap since the survey’s inception," the number of pessimists is higher than that of optimists.
The number of those who see the economy as being on the wrong track dropped only 6 percentage points since October and a total of 25 percentage points in the past year.
Fannie’s survey findings are based on live telephone interview responses from 1,001 homeowners and renters on a monthly and quarterly basis.