The Fannie Mae (OTCQB: FNMA) Home Purchase Sentiment Index® (HPSI) increased 2.2 points in July to 93.7, a new survey high and 7.2 points ahead of the same month last year.

An NAHB Economics poll conducted during the first quarter of 2018 found that 17% of American adults plan to buy a home within the next 12 months.
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Five of the six HPSI components increased month over month, with an 8-percentage point increase in the net "Confidence About Not Losing Job" component driving the index higher. On a year-over-year basis, the forward-looking job confidence and "Mortgage Rates Will Go Down" components are up 16 and 24 percentage points, respectively.

"Consumer job confidence and favorable mortgage rate expectations lifted the HPSI to a new survey high in July, despite ongoing housing supply and affordability challenges," said Doug Duncan, senior VP and chief economist. "Consumers appear to have shaken off a winter slump in sentiment amid strong income gains. Therefore, sentiment is positioned to take advantage of any supply that comes to market, particularly in the affordable category. However, recent financial market events following when the survey data were collected could weigh on consumer views looking ahead."

HOME PURCHASE SENTIMENT INDEX – COMPONENT HIGHLIGHTS

  • The net share of Americans who say it is a good time to buy a home increased 3 percentage points to 26%. This component is up 2 percentage points from the same time last year.
  • The net share of those who say it is a good time to sell a home increased 1 percentage point to 44%. This component is up 3 percentage points from the same time last year.
  • The net share of those who say home prices will go up over the next 12 months decreased 1 percentage points to 37%. This component is down 2 percentage points from the same time last year.
  • The net share of Americans who say mortgage rates will go down over the next 12 months increased 1 percentage points to -28%. This component is up 24 percentage points from the same time last year.
  • The net share of Americans who say they are not concerned about losing their job over the next 12 months increased 8 percentage points to 81%. This component is up 16 percentage points from the same time last year.
  • The net share of those who say their household income is significantly higher than it was 12 months ago increased 1 percentage point to 21%. This component is unchanged from the same time last year.