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Optimism down after a hitting historic highs

by Timothy Inklebarger

Optimism down after a hitting historic highs

Fannie Mae released its September Home Purchase Sentiment Index today, showing a 2.3-point drop from the previous month to 91.5. The decrease comes after the mortgage giant measured a survey high in its August numbers. The index is still up 3.8 points compared to September of last year.

It seems the main reasons respondents were feeling less optimistic were related to employment and property values. Survey questions that demonstrated declines included 8 percentage points in the “Confidence About Not Losing a Job” component and 7 percentage points in the “Home Will Go Up” component.

Those were offset in part by the “Good Time to Buy” component, which increased 3 percentage points and “Good Time to Sell”, which was up 4 percentage points. This comes on the heels of the National Association of Realtors Housing Opportunities and Market Experience survey, which found increasing support for the idea that now is a good time to buy or sell a home.

“Consumer sentiment remains relatively strong overall, though uncertainty about the economy and individual financial circumstances appear to be weighing on housing market attitudes a bit more than a month ago,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Views about the direction of the economy held relatively steady, and the share of respondents who say it’s a good time to buy or sell a home rose slightly. However, consumers who are pessimistic about current housing market conditions are more likely to cite unfavorable economic conditions than the prior month. Job confidence remains high but still well shy of its July reading. Despite some added uncertainty, the September HPSI indicates continued strength in housing market attitudes and is consistent with recent data on housing activity.”

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