Despite budget sequestration and other fiscal policy concerns, consumers remain confident that the housing market will recover, according to the Fannie Mae March 2013 National Housing Survey. However, they have greater pessimism in their personal finances and the economy.
“Despite an uptick in concern expressed about the direction of the economy, it appears consumers believe that the housing recovery will march on,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Housing sentiment remains unshaken from the highs of the last few months. At the same time, perhaps driven by the experience of the past several years, consumers remain cautious in their housing outlook. By comparison, main measures of national home prices in early 2013 posted year-over-year gains of at least double or triple that figure.”
Forty-eight percent of survey respondents believe home prices will go up in the next year, and 26 percent believe now is a good time to sell a home — both of which are all-time survey highs. Also, 10 percent believe home prices will go down this year, which is a survey low.
In addition, 46 percent of respondents think mortgage rates will go up, which is the highest level since May 2011, and those who think they’ll go down dropped to 6 percent.
While survey respondents are confident in the U.S. housing market, the same can’t be said about their personal finances and the country’s economy, as the federal budget sequestration lingers on and many households remain on tight budgets. Just 35 percent of respondents said they believe the economy is on the right track, which is a decrease of 3 percentage points from February.
Additionally, 21 percent believe their personal financial situation will worsen over the next 12 months, which is an increase of 4 percentage points from February, and 20 percent of respondents said their household income is significantly higher than it was 12 months ago, which is a slight decrease from last month.
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According to a recent Gallup poll, 18 percent of Americans said economic conditions are excellent or good and 35 percent said they are poor, which is about even with the week prior.