In May, the Fannie Mae Home Purchase Sentiment Index (HPSI) fell 2.5 points to 69.4, reaching an all-time survey low since its start in 2010. The full index is up 3.8 points year over year.

Down from 20% in April, only 14% of consumers think it’s a good time to buy a home and 86% believe it’s a bad time to buy.

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"Consumer sentiment toward housing declined from its recent plateau, as an increasing share of consumers struggle to find the positives in the current housing market," says Doug Duncan, Fannie Mae senior vice president and chief economist.

"While many respondents expressed optimism at the beginning of the year that mortgage rates would decline, that simply hasn't happened, and current sentiment reflects pent-up frustration with the overall lack of purchase affordability. This is most clearly evidenced by our 'good time to buy' component falling to a new survey low this month,” Duncan says.

The percentage of respondents who say it is a good time to sell a home decreased from 67% to 64%, while the percentage who say it's a bad time to sell increased from 32% to 35%. The resulting net share of those who say it is a good time to sell decreased 6 percentage points month over month.

In May, those who say home prices will go up in the next 12 months remained unchanged at 42% in May and the percentage who say home prices will go down remained unchanged at 18%. The share who think home prices will stay the same increased from 39% to 40% resulitng in the net share of those who say home prices will go up in the next 12 months increasing 2 percentage points month over month.

“Homeowners' perception of home-selling conditions declined only slightly and remains largely positive after a steady increase over the last few months. This suggests to us that, despite the so-called 'lock-in effect,' some homeowners may increasingly want or need to sell their homes for a myriad of non-financial reasons, which may lead to an increase in listings in the near future,” Duncan adds. “As our latest forecast notes, we expect improvements to housing inventory will lead to slightly increased sales activity through the end of the year."

The percentage of respondents who were hopeful for mortgage rates will go down in the next 12 months decreased from 26% to 25% while the percentage who expect mortgage rates to go up fell from 33% to 31%. Those who think mortgage rates will stay the same increased from 40% to 42%.

In terms of job loss concern and household income, those who say they are not concerned about losing their job in the next 12 months decreased from 76% to 75% and those who are concerned increased from 23% to 24%.

On a positive note, the percentage of respondents who say their household income is significantly higher than it was 12 months ago increased from 17% to 20%, while those who say their household income is significantly lower remained unchanged at 12%.