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Housing market confidence rose in August after a slight dip back in July, but current sentiments are nothing compared to last year’s confidence. National Mortgage News reports that Fannie Mae’s Home Purchase Sentiment Index hit 77.5 last month, up 3.3 points from July. Month to month, there are positive increases but the index reached a whopping 93.8 in August 2019. This year-over-year change is most likely due to the uncertainty from the pandemic. Selling sentiment grew by 4 points in August and optimism for sellers gained 3 points since July.
"The HPSI's recovery was driven by near-record low mortgage rates that helped restore much of consumers' positivity on whether it is a good time to buy a home, while also improving the good-time-to-sell sentiment," Doug Duncan, senior vice president and chief economist at Fannie Mae, said in a press release. "The August survey was conducted as consumers continue to face uncertainty regarding schools' and businesses' reopening plans and as the CARES Act $600-per-week income supplement expired."
While worries over employment in the next 12 months remained inflated from year-ago feelings, the sentiment is becoming more optimistic. The net faction of consumers not concerned about job loss grew by 3 percentage points from July, while sitting 21 percentage points below August 2019. Relatedly, the net share of households reporting a significantly higher income from the past 12 months jumped to 9% from 6% in July but hangs back from August 2019's 21%.
