Coronavirus job anxiety brings housing sentiment to 4-year low
Economic instability caused by the coronavirus pandemic drove consumer confidence for home buying to plummet to its lowest point since December 2016, according to Fannie Mae.
The Fannie Mae Home Purchase Sentiment Index notched a record drop: decreasing from 92.5 in February and 89.8 from the year prior to 80.8 in March.
"Attitudes about the current home-selling environment deteriorated markedly, falling to their lowest level since January 2017," Doug Duncan, senior vice president and chief economist at Fannie Mae, said in a press release.
Only 54% expressed no concern of losing their job in the next 12 months, falling from 72% last month and 80% the year before.
A 20% share of consumers claimed March was a good time to buy a home, decreasing from 27% in February and 22% in March 2019. Even starker: only 16% said it was a good time to sell compared to 45% and 43% the month and year before, respectively.
Of those who said March posed disadvantageous home-selling conditions, 47% attributed unfavorable economic conditions and 16% credited low prices. An additional 7% specifically wrote in COVID-19.
"A survey record one-month drop in optimism about the direction of the economy appears to have weakened consumers' views of both the current home-selling and home-buying environment, though the latter is likely buffered in part by low mortgage rates," Duncan said.
"When asked why it's a bad time to buy or sell a home, approximately 7% of consumers offered COVID-19 as an unprompted response, one of the highest percentages of nonstandard answers in the survey's history. We expect these developments to weigh heavily on housing activity during the spring/summer home-buying season."