High housing prices, increased concerns about job stability and rising mortgage rates are deterring potential homebuyers
The share of Americans who say it’s a good time to buy a house hit an all-time low of 25% in a monthly Fannie Mae survey.
The pandemic-era surge in U.S. housing prices, combined with increased concerns about job stability and rising mortgage rates, are deterring potential buyers from trying to purchase a home.
“Younger consumers—more so than other groups—expect home prices to rise even further,” said Doug Duncan, Fannie Mae’s chief economist. “They also reported a greater sense of macroeconomic pessimism.”
In the January survey, 69% of respondents said it’s a good time to sell, an all-time high in the series that dates back to 2010.
The lack of affordable houses, made even more acute by the Covid-19 crisis, is hitting the younger generations the hardest. An analysis from Zillow Group Inc. showed that home prices are rising the fastest in family-friendly suburbs, a trend that’s set to persist as a record number of millennials approach what’s traditionally been home-buying age for Americans.
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And the rental market isn’t helping either. The Fannie Mae survey found that consumers expect rents to increase by a record this year.
In spite of a surprisingly strong labor market in January, the share of respondents concerned about losing their job over the next 12 months rose to a 10-month high. And, for the eighth month, a majority of respondents think the U.S. economy is on the wrong track.
The survey polled approximately 1,000 people via live telephone interviews between Jan. 1 and Jan. 24. Most of the data was collection occurred during the first two weeks of this period.