With mortgage rates still under 3%, Americans reported a more optimistic view towards home buying and home in August, according to Fannie Mae.
The GSE's Home Purchase Sentiment Index (HPSI) edged up 3.3 points to a reading of 77.5, recovering from a slight setback in July. However, the index was 16.3 points lower than it was a year ago.
"The HPSI rose modestly in August, recovering the ground it lost in July," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "The HPSI's recovery was driven by near-record-low mortgage rates that helped restore much of consumers' positivity on whether it is a good time to buy a home, while also improving the good-time-to-sell sentiment. The August survey was conducted as consumers continue to face uncertainty regarding schools' and businesses' reopening plans and as the CARES Act $600-per-week income supplement expired."
Of the six HPSI components, five posted month-over-month gains in August:
- The net share of Americans who say it is a good time to buy a home increase nine percentage points to 59% in July
- The net share of Americans who think it is a good time to sell rose seven percentage points to 48%
- The net share of Americans who expect home prices to go up in the next 12 months decreased five percentage points to 33%
- The net share of Americans who believe mortgage rates will go down in the next 12 months increased three percentage points to 17%
- The net share of Americans who say they are not concerned about losing their job in the next 12 months climbed three percentage points to 78%
- The net share of Americans who reported that their household income is significantly higher than it was 12 months ago inched up three percentage points to 25%