Homebuyer Faith Restoring in Housing Recovery

By Stevie Duffin Updated on 12/14/2012

By Daniel Duffield

Of the consumers responding to the latest housing survey from Fannie Mae, a 69% majority stated that they would prefer to purchase a home rather than rent if moving in the near future.

Fannie Mae, which surveyed 1,000 consumers for its September poll, said that the levels remain consistent with levels in June, which have embodied the peak for the survey’s entire history, indicating that consumer reaction to the housing market may be showing a positive reversal.

According to Doug Duncan, senior vice president and chief economist of Fannie Mae, consumers have been demonstrating a growing hope in the emerging housing recovery. Consumers have largely anticipated positive home value shifts for 11 consecutive months, with negative home price expectations remaining near the survey low at 11%.

Although the survey does not necessarily illustrate any faith in a strong housing market recovery, expectations of consumers interviewed by Fannie Mae in terms of home prices have increased to an average price increase of 1.5% over the next year. Concurrently, consumers do not expect mortgage rates to increase over the next year, as the survey statistics demonstrated a 7% drop in this field to 33%.

Of those who participated in the survey, 19% stated that they believe that it is a good time to sell a property, reaching the highest percentage level in the past two years. Additionally, 41% of consumers believe that the economy is growing stronger, rising 8% from August’s 33% level.

53% still think that the economy is not recovering; however, while this figure is relatively high, it shows some improvement over last month’s recorded 60%.

44% of the survey respondents anticipate that financial conditions will progress positively over the next year, rising from 42% in August. Furthermore, the share of surveyed consumers who state their household income to be greater than a year ago declined 3% to 17%.

With rates currently hitting record lows, purchasing a home may truly be more beneficial currently than renting, made even easier with low down payment loans such as FHA loans and USDA loans.