Fannie Mae keeps a close eye on every part of the financing side of housing but one of the reports the offsite and modular housing industry reads thoroughly is the monthly Consumer Confidence in Housing. As part of every factory’s business plan and five-year strategy, this report is a good way to help owners and management predict what consumers have reported.
The Fannie Mae Home Purchase Sentiment Index® (HPSI) decreased 4.1 points in October to 56.7, its eighth consecutive monthly decline and the lowest reading since the inception of the index in 2011.
Five of the six index components decreased month over month, including those associated with home buying and selling conditions, as persistently high home prices and unfavorable mortgage rates continue to fuel consumers’ housing affordability concerns.
Take a good look at this month’s Consumer Confidence Index and sit down together with management and owners and decide if this is something that needs your attention. My guess is it is!
Here are the highlights from the latest report:
Good/Bad Time to Buy:
The percentage of respondents who say it is a good time to buy a home decreased from 19% to 16%, while the percentage who say it is a bad time to buy increased from 75% to 80%. As a result, the net share of those who say it is a good time to buy decreased by 8 percentage points month over month.
Good/Bad Time to Sell:
The percentage of respondents who say it is a good time to sell a home decreased from 59% to 51%, while the percentage who say it’s a bad time to sell increased from 33% to 42%. As a result, the net share of those who say it is a good time to sell decreased by 17 percentage points month over month.
Home Price Expectations:
The percentage of respondents who say home prices will go up in the next 12 months decreased from 32% to 30%, while the percentage who say home prices will go down increased from 35% to 37%. The share who think home prices will stay the same decreased from 28% to 26%. As a result, the net share of those who say home prices will go up decreased by 4 percentage points month over month.
Mortgage Rate Expectations:
The percentage of respondents who say mortgage rates will go down in the next 12 months decreased from 9% to 6%, while the percentage who expect mortgage rates to go up increased from 64% to 65%. The share who think mortgage rates will stay the same increased from 20% to 24%. As a result, the net share of those who say mortgage rates will go down over the next 12 months decreased 4 percentage points month over month.
Job Loss Concern:
The percentage of respondents who say they are not concerned about losing their job in the next 12 months increased from 78% to 85%, while the percentage who say they are concerned decreased from 21% to 15%. As a result, the net share of those who say they are not concerned about losing their job increased by 13 percentage points month over month.
Household Income:
The percentage of respondents who say their household income is significantly higher than it was 12 months ago decreased from 26% to 25%, while the percentage who say their household income is significantly lower increased from 11% to 15%. The percentage who say their household income is about the same decreased from 61% to 60%. As a result, the net share of those who say their household income is significantly higher than it was 12 months ago decreased 5 percentage points month over month.
CLICK HERE to read the entire Fannie Mae report for October 2022
Gary Fleisher is the Editor in Chief of Modular Home Source and Offsite Builder. Email at [email protected]
Gary Fleisher, Editor in Chief of Offsite Construction Magazine
To learn more about the Offsite Construction Industry, sign up for your free monthly issue of Offsite Builder, the Construction Magazine for Builders and Developers
