Last month, it appeared that housing market conditions were improving slightly, giving homebuyers some optimism about their prospects for securing their dream home. It looks like that positivity didn’t last.
According to Fannie Mae’s latest Home Purchase Sentiment Index, a view into how consumers feel about the housing market based on a national survey, just 28% of those surveyed think that now is a good time to buy a house. That’s down from 32% in August and back to where it was in July.
Along those same lines, 66% of those surveyed think that it’s a bad time to buy a home, up from 63% last month.
Overall, the HPSI fell by a slight amount in September, with the buy side of the equation making up all of the decline. The sell side of things was much more positive.
According to the report, 74% of those surveyed think now is a good time to sell a house, while just 19% think it’s a bad time to sell.
The reason for the sentiments about the conditions of the market from both sides is the same: home prices.
“The HPSI declined slightly this month but remains within the general bounds we’ve seen since the end of last year,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. “The survey’s story is also largely unchanged: Consumers feel it’s a bad time to buy a home but a good time to sell – and they continue to cite high home prices as the primary reason.”
Duncan added that renters and younger people were “slightly more likely” to say that it is a bad time to buy, indicating that they are concerned about the affordability and availability of homes.
“We’re also seeing a softening in consumers’ expectations that home prices will continue to increase,” Duncan concluded, “however, in our view, other housing market fundamentals remain supportive of further home price appreciation – including low levels of inventory and low interest rates.”