Housing confidence hit an all-time high as more consumers report it's a good time to sell, while also anticipating a rise in home prices but a drop in mortgage rates, according to Fannie Mae's Home Purchase Sentiment Index.
Though five of the six components measured in Fannie Mae's HPSI increased in April, the net share of consumers reporting it's a good time to buy a home fell six percentage points from a year ago as an especially competitive home buying season is underway. Demand for housing continues outpacing supply, putting upward pressure on home prices and creating affordability hurdles for consumers.
While the net share of respondents expecting home prices to rise grew 4% year-over-year and 7% month-over month in April, those claiming mortgage rates will drop in the next 12 months increased 9% from a year ago and 4% from March.
"The latest HPSI reading edged up to a new survey high, showing that consumer attitudes remain resilient going into the spring/summer home buying season," Doug Duncan, senior vice president and chief economist at Fannie Mae, said in a press release.
"High home prices and good economic conditions helped push the share of Americans who think it's a good time to sell to a fresh record high. However, the upward trend in the good-time-to-sell share seen since last spring has done little to release more for-sale inventory. The tightest supply in decades, combined with rising mortgage rates from historically low levels, will likely remain a hurdle for mobility and a persistent headwind for home sales," he continued.
While affordability remains a challenge for consumers, the net share of people reporting their household income is significantly higher from the previous 12 months grew five percentage points on an annual basis and one percentage point from the prior month.
The new HPSI peak hit in April was 91.7, up 5% year-over-year.