In its latest Home Purchase Sentiment Index (HPSI) survey, Fannie Mae said consumers reported a more optimistic view of home-selling conditions.
The HPSI gauges consumer perception on owning or renting a home, home and rental price changes, the economy, and household finances. The higher the HPSI number, the more optimistic consumers are about the national housing situation.
“The HPSI has recovered more than half of the early pandemic-period decline, mirroring the strong home purchase activity of the past few months,” Fannie Mae Senior Vice President and Chief Economist Doug Duncan said in a release.
The HPSI increased by 3.5 points in September, a second consecutive increase since a dip in July. The total, 81, has the appearance of a continuing rebound from late spring. It is still down 10.5 points from the same time last year.
According to the September 2020 data release, the increase in the HPSI is attributed to increases in home price outlook, selling conditions, and a decrease in job loss concern. The perception of selling conditions was up 14 points month-over-month, while buying conditions went down by eight points.
“Consumers’ home price expectations were up strongly this month, with high home prices playing an increasingly – though unsurprisingly – important role in driving both the increase in ‘good time to sell’ sentiment and the decline in ‘good time to buy’ sentiment,” Duncan said. “Going forward, we believe the wild card to be whether enough sellers enter the market to continue to meet the strong homebuying demand. The home purchase market requires the proper mix of home price growth and continued economic recovery to achieve sustainable levels of housing activity.”
Additional data also showed if most consumers were to move, 71 percent of those surveyed would buy a home over renting, a new survey high. Forty percent of consumers also stated they believed the economy is on the right track, the highest it has been since April.