American consumers’ confidence in the housing market has lost power in the latest survey from Fannie Mae.
Its Home Purchase Sentiment Index, which gained to record highs in April and May, lost 1.6 points in June to 90.7. Although it is 2.4 points above its June 2017 reading.
“After several years of steadily climbing, HPSI’s slowing upward trend suggests the index may be reaching a plateau,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Tight supply and lackluster income growth continue to weigh on housing activity, and consumer expectations for home price growth over the next 12 months have moderated. However, consumers expressed increased optimism about the direction of the economy and their personal financial situations over the next 12 months, with both measures matching previous survey highs this month.”
There was no change in the net share of Americans who say now is a good time to buy (28%) but the net share of those who say now is a good time to buy rose 1 percentage point to 47%, a new survey high.
The net share of those who say mortgage rates will go down over the next 12 months decreased 4 percentage points to -53% while the net who say home prices will go up in the next 12 months fell 3 percentage points from last month to 46%.
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