Homebuying Sentiment Bounces Back After 10-Year Low, Concerns Remain

Homebuying sentiment climbed in May after two record-setting drops in March and April. The Fannie Mae Home Purchase Sentiment Index rose 4.5 points, bringing the index to 67.5, according to National Mortgage News. There has also been improvement in whether people think it’s a good time to sell, if home prices will rise, and if it is a good time to buy. Though these are encouraging signs, the index is still way below May 2019’s reading of 92, and home buyers continue to have major concerns including the loss of a job or income.

As coronavirus lockdowns begin to lift, consumer housing confidence shows signs of improvement after hitting a 10-year low, according to Fannie Mae.

After back-to-back record sentiment drops in March and April, the Fannie Mae Home Purchase Sentiment Index regained traction in May, climbing 4.5 points. The increase brought the index to 67.5 compared to readings of 63 the month before and 92 in May 2019.

“Although the HPSI’s precipitous declines of March and April did not continue in May, Americans' financial, economic and housing market concerns remain substantially elevated compared to survey history," Doug Duncan, senior vice president and chief economist at Fannie Mae, said in a press release. "Low mortgage rates have helped cushion some of the impact of the pandemic on consumer sentiment regarding whether it’s a good time to buy a home, which picked back up this month to late-2018 levels."

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