Consumers became more encouraged by the housing market in December, as they reflected on their higher wages compared to a year earlier, Fannie Mae said.
Fannie Mae's Home Purchase Sentiment Index rose 2.4 percentage points to 83.2 in December, compared to November. The share of consumers who said their income was significantly higher than 12 months ago rose 9 percentage points.
More consumers were feeling good about their job security, as the share who said they were unconcerned about losing their job rose 3 percentage points.
The number of consumers who said now is a good time to sell their home rose 4 percentage points.
"Brightening economic prospects, if sustained, should stimulate demand for homeownership," Doug Duncan, Fannie Mae's chief economist, said in a news release. "However, continuing upward pressure on rental prices and constrained housing supply, particularly for starter homes, may mean prospective first-time homebuyers could face affordability constraints."
The index is constructed from National Housing Survey questions that Fannie Mae asks consumers each month.
