June 07, 2012Consumer Sentiment Appears to be Reaching Plateau Heading into Summer Season
WASHINGTON, DC – Gradual positive trends in consumer attitudes observed since early fall 2011 appear to be reaching a plateau, according to results from Fannie Mae’s May 2012 National Housing Survey. Recent consumer attitudinal trends reflect overall macroeconomic indicators, which point to a continued lull in the pace of employment and income growth.
“Our May consumer data show that Americans are taking a ‘wait and see’ approach about buying or selling a home. This is not surprising given their assessment that their income during the past twelve months and their personal financial expectation for the next twelve have leveled off. These data are in line with what we are seeing on the macroeconomic front, as upside and downside risks and activities are moderating one another,” said Doug Duncan, vice president and chief economist of Fannie Mae. “Current jobs data are reminiscent of the spring slowdown that continued into the summer months during the last two years. If this pattern continues, we do not expect to see any significant upturn in consumer sentiment during the summer and a meaningful housing recovery likely will be delayed once again.”
The leveling of consumer attitudes can be seen in Americans’ inclination to buy (versus rent) their next home despite some mildly positive trends. Forty-one percent of National Housing Survey respondents expect home mortgage rates to go up in the next twelve months (a slight increase from last month). At the same time, on average, Americans expect home prices to increase 1.4 percent over the next twelve months (up from 0.9 percent in March 2012 and the highest value yet recorded.) Both indicators suggest the potential that consumers may consider moving off the sidelines to purchase a home. Nevertheless, the percentage of respondents who would buy is down to 63 percent in May from 64 in April and 66 percent in March.
Homeownership and Renting
The Economy and Household Finances
The most detailed consumer attitudinal survey of its kind, the Fannie Mae National Housing Survey polled 1,002 Americans via live telephone interview to assess their attitudes toward owning and renting a home, mortgage rates, homeownership distress, the economy, household finances, and overall consumer confidence. Homeowners and renters are asked more than 100 questions used to track attitudinal shifts (findings are compared to the same survey conducted monthly beginning June 2010). Fannie Mae conducts this survey and shares monthly and quarterly results so that we may help industry partners and market participants target our collective efforts to stabilize the housing market in the near-term, and provide support in the future.
For detailed findings from the May 2012 survey, as well as a podcast providing an audio synopsis of the survey results and technical notes on survey methodology and questions asked of respondents associated with each monthly indicator, please visit the Fannie Mae Monthly National Housing Survey site. Also available on the site are quarterly survey results, which provide a detailed assessment of combined data results from three monthly studies. The May 2012 Fannie Mae National Housing Survey was conducted between May 3, 2012 and May 24, 2012. Interviews were conducted by Penn Schoen Berland, in coordination with Fannie Mae.