Fannie Mae on Wednesday (7-7-21) released their Home Purchasing Sentiment Index® (HPSI) for June. Overall, the HPSI was little changed, decreasing by -0.3 points to a reading of 79.7. This occurred despite even greater volatility among its underlying components. Again, in June, the “Good Time to Buy” and “Good Time to Sell” components once again provided the most notable results. On the buy-side, 64% of respondents said it’s a bad time to buy a home, up from 56% in May; while on the sell-side, 77% of respondents said it’s a good time to sell, up from 67% last month. The components more closely associated with household finances were largely flat month over month but remain elevated compared to this time last year, particularly the component regarding job security. Year over year, the overall index is up 3.2 points.
In remarks prepared for the release of the HPSI, Fannie Mae Senior Vice President and Chief Economist, Doug Duncan said, “The HPSI remained flat this month, although its underlying buy and sell components continued to diverge, setting record positive and negative readings, respectively. Consumers also continued to cite high home prices as the predominant reason for their ongoing and significant divergence in sentiment toward homebuying and home-selling conditions. While all surveyed segments have expressed greater negativity toward homebuying over the last few months, renters who say they are planning to buy a home in the next few years have demonstrated an even steeper decline in homebuying sentiment than homeowners. It’s likely that affordability concerns are more greatly affecting those who aspire to be first-time homeowners than other consumer segments who have already established homeownership.”
Duncan went onto say, “Despite the pessimism in homebuying conditions, we expect demand for housing to persist at an elevated level through the rest of the year. Mortgage rates remain not too far from their historical lows, and consumers are expressing even greater confidence about their household income and job situation compared to this time last year when the pandemic had shut down wide swaths of the economy.”
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Consumers Increasingly Adamant That It’s a Good Time to Sell, Bad Time to Buy a Home