NATNews Blog > October 2016 > ​Consumers Show Increased Caution in Home Purchase Sentiment in September

    ​Consumers Show Increased Caution in Home Purchase Sentiment in September

    10/10/2016 9:03:13 AM
    By Katie Penote
     
    The Fannie Mae Home Purchase Sentiment Index (HPSI) decreased 2.2 points to 82.8 in September, moving further off of survey highs.
     
    Consumer caution surfaced in the September HPSI, in which four of the six components decreased during the month. The largest decrease was seen in the net share of consumers who expect mortgage interest rates to go down over the next 12 months, which fell 6 percentage points. This was followed by a 5 percentage point drop in the net share of consumers who say now is a good time to buy a home and a 3 percentage point drop in the net share of consumers reporting confidence about not losing their job over the next year. Household Income was the only HPSI component to increase in September with slightly more consumers than the previous month reporting that their household income is significantly higher than it was 12 months ago.
     
    “The decline in the HPSI over the past two months from the survey-high in July of 86.5 adds a note of caution to our moderately positive housing outlook,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Downside changes came in particular from the HPSI components mortgage rate direction and good time to buy a house. In addition, the starter home tight supply and rising home prices as well as the unsettled political environment are likely giving many consumers a reason to pause or question their home purchase sentiment.”
     
    HPSI Component Highlights
     
    • Fannie Mae’s September 2016 HPSI decreased 2.2 percentage points in September to 82.8. Overall, the HPSI is down 1.0 point since this time last year.
    • Breaking from the increasing trend of the last few months, the net share of Americans who say it is a good time to buy a house fell by 5 percentage points to 29 percent to match a previous all-time low reached in May. 
    • The net percentage of those who say it is a good time to sell a house remained at 15 percent in September.
    • The net share of Americans who say that home prices will go up fell 1 percentage point from last month to 34 percent.
    • The net share of those who say mortgage rates will go down over the next twelve months fell 6 percentage points to negative 44 percent.
    • The net share of Americans who say they are not concerned with losing their job fell 3 percentage points to 70 percent.
    • The net share of Americans who say their household income is significantly higher than it was 12 months ago rose 2 percentage points to 12 percent.
     
     
    Detailed HPSI and NHS Findings

    For detailed findings from the September 2016 Home Purchase Sentiment Index and National Housing Survey, as well as a brief HPSI overview and detailed white paper, technical notes on the NHS methodology, and questions asked of respondents associated with each monthly indicator, please visit the Consumer Attitude Measures page on fanniemae.com. Also available on the site are in-depth topic analyses, which provide a detailed assessment of combined data results from three monthly studies of NHS results.