The disconnect in the market is likely partially due to the limited number of homes for sale in many markets, allowing sellers to face less competition and ask for higher home prices. On the other hand, home buyers are having fewer choices and stuck paying higher prices, sometimes in multiple-bid situations.
Indeed, “we can partially attribute the sizable gain in April in home selling optimism both to a correction for last month’s unexpected dip and to typical seasonal strength in housing activity in the spring and summer,” says Doug Duncan, senior vice president and chief economist at Fannie Mae. “Even after accounting for these factors, continued tight housing supply has led to renewed strength in home price appreciation, making selling a home a more attractive prospect this year in particular. This improved sentiment could provide an extra boost of much-needed supply for the spring selling season.”
Some highlights from Fannie Mae’s latest Home Purchase Sentiment Index:
- 30% of Americans say now is a good time to purchase a home, a drop of 3 percentage points from the previous month and now at an all-time survey low.
- 15% of Americans say now is a good time to sell a home, now at an all-time survey high.
- More consumers think home prices will rise over the next 12 months compared to March, and slightly fewer consumers also expect mortgage rates to go up over the next year.
- The percentage of respondents who say they are not concerned with losing their job increased 6 percentage points to 74%, nearly a 7 percentage point decrease in March.
- The percentage of respondents who say their household income is significantly higher than it was 12 months ago held at 11%.
Source: Fannie Mae