24 May CONSUMER CONFIDENCE DRIVES REAL ESTATE MARKET
This spring, a key housing index fell to a record low amid the COVID-19 pandemic.
Much to the surprise of many, the market bounced back impressively thanks to consumer confidence and ultra-low interest rates.
Fannie Mae’s Purchase Sentiment Index fell 29.5 points in March and April but grew 4.5 and 9 points in May and June, respectively.
Thanks to positive responses from four out of six surveys, the index sits at 76.5 but still lags slightly behind June 2019 levels.
Respondents remain optimistic about their prospects of buying or selling a home, with 61 percent agreeing that now is an excellent time to purchase.
Job security also ranked high on the respondents’ minds, with 74 percent saying they were not concerned about losing their jobs. Over the last few months, however, a growing number of people have expressed concern because of the pandemic and its economic impacts.
The survey also showed higher household incomes than the previous year and fewer income downgrades for a net gain of nine percent in this category.
Another finding: respondents believe that home prices will continue to trend upward through 2020 and beyond. Meanwhile, consumers also feel that interest rates have bottomed out.
The big takeaway is that the market is full of confidence and activity. The uptick in sales paved the way for the index to make up for some sharp losses during shelter-in-place orders a few months ago.
The share of renters who view homebuying favorably reached a five-year high. Meanwhile, shrinking demand is inspiring homeowners to test the market.
Premier Mortgage understands the enthusiasm within the real estate market.
We continually work with families to help them reach their homeownership’s goals, which has gained greater importance in today’s world.
If you’re thinking about buying a home, taking advantage of low interest rates and joining so many others on this exciting journey, please let us know how we can help.
We offer an array of loan programs, including fixed-rate mortgages, adjustable-rate mortgages, FHAs, VAs, and interest-only programs. Each one is suited to reach different goals so you can make good on your financial plans and goals.
Please contact us today to learn more about today’s fast-moving market and how you can be a part of an exciting economic shift.