Consumer fears over economy slow housing activity.
The share of respondents who still believe the economy is headed in the wrong direction remained at 57 percent last month, and those who said their household income is significantly higher than it was at the same time last year decreased four percentage points to 21 percent.
Although respondents' attitudes toward housing have been generally positive during the past few months, their reluctance to enter the home buying or selling market has restrained activity below typical seasonal trends.
Consumers arereticence about the economy seem to be holding back housing demand, said Doug Duncan, senior vice president and chief economist at Fannie Mae. "This year's spring and summer home buying season has gotten off to a slow start, even as mortgage rates have trended lower over the past two months.
"Our National Housing Survey data show that economic conditions continue to be the top concern among consumers who think it's a bad time to buy or sell a home. While recent housing activity suggests that the worst of the housing slump may be behind us, this caution among consumers supports our expectation that the rebound in home sales will likely be too modest to pull sales for all of 2014 ahead of last year."
Survey highlights include:
- The average 12-month home price change expectation remained unchanged from last month, at 2.9 percent.
- The share of respondents who say home prices will go up in the next 12 months fell to 48 percent, and the share saying home prices will go down increased to 7 percent.
- The share of respondents who say mortgage rates will go up in the next 12 months continued on a downward trend, dropping to 49 percent.
- Those who say it is a good time to buy a house fell slightly to 68 percent, and those who say it is a good time to sell a house increased to 43 percent, a new all-time survey high.
- The average 12-month rental price change expectation decreased slightly to 3.9 percent.
- Fifty-one percent of those surveyed said home rental prices will go up in the next 12 months, while 3 percent of respondents said home prices will go down.
- Forty-nine percent of respondents thought it would be easy for them to get a home mortgage today, rising 4 percentage points from last month.
- The share saying they would buy if they were going to move increased slightly to 66 percent.
- The share of respondents who say the economy is on the right track increased 3 percentage points from last month to 38 percent.
- The percentage of respondents who expect their personal financial situation to get better over the next 12 months fell slightly to 42 percent.
- The share of respondents who say their household income is significantly higher than it was 12 months ago decreased 4 percentage points to 21 percent.
- The share of respondents who say their household expenses are significantly higher than they were 12 months ago decreased 5 percentage points to 34 percent.
Homeowners and renters are asked more than 100 questions used to track attitudinal shifts (findings are compared to the same survey conducted monthly beginning June 2010).
The May 2014 Fannie Mae National Housing Survey was conducted between May 1, 2014 and May 21,