Employment concerns and the pandemic's many ongoing obstacles for home buying wore down consumer confidence in November, according to Fannie Mae.
After three months of increases, the Home Purchase Sentiment Index dipped to 80 from
Selling sentiment skewed positive by 26 percentage points in November, a 2 point improvement month-over-month, but a 14 point drop year-over-year. Seller optimism held at 59% from October. Consumer attitude for buying had a net positive score of 22 percentage points. The share of good-time-to-buyers slid to 57%, down 3 points from last month and 10 from last year.
Nearly half of borrowers expect mortgage rates to stay the same in the next 12 months while 43% expect growth and 8% expect them to
"The HPSI appears to have peaked for now as consumers continue to consider how COVID-19 impacts their ability to buy or sell a home," Doug Duncan, senior vice president and chief economist at Fannie Mae, said in a press release. "This follows the HPSI's recovery of slightly more than half of the loss experienced during the first few months of the pandemic."
The sentiments
Concerns over job losses grew in November, as a 48% share of consumers worried about their livelihoods. That's up 6 percentage points month-over-month and 20 points year-over-year. The net share of households reporting a significantly higher income from the past 12 months went to 6%, up 3 percentage points from October but down 12 points from the year prior.
Consumer attitudes about the home price forecast were mixed. A 28% share of survey respondents predict housing prices to increase in the next year — a jump of 8 percentage points from October and a 6 point drop from November 2019. Just 13% believed that prices will decline in 2021, marking a drop from 20% who believed so in October.
"Drilling down a bit, home purchase confidence has recovered more for homeowners than for renters, in part because homeowners have been less likely than renters to have had their jobs and finances impacted by the pandemic," Duncan said.
