CNBC: “More Americans Think It’s a Bad Time to Buy a Home”

via CNBC:

  • The share of Americans who think it is a good time to buy a home just dropped sharply, according to a December survey from mortgage giant Fannie Mae.
  • The share of those surveyed who think home prices will go up fell 2 percentage points, and those who expect mortgage rates to drop was unchanged.
  • The share of those who said their household income was significantly higher than a year ago fell compared with November, although it was up slightly from a year ago. Consumers are, however, quite confident about employment.

More Americans think it is a bad time to buy a home, as fewer potential buyers can afford what is on the market.

The share of Americans who think it is a good time to buy a home just dropped sharply, according to a December survey from mortgage giant Fannie Mae. Higher mortgage rates and increased home prices are likely to blame. Homes are simply very expensive right now, in relation to income, and there are still very few entry-level homes for sale.

Yet while home prices are higher than they were one year ago, the pace of gains is decelerating. That is not lost on potential buyers. The share of people surveyed who think home prices will go up fell 2 percentage points, and those who expect mortgage rates to drop was unchanged.

Mortgage rates did decline rather precipitously during December, from an average 4.85 percent on the 30-year fixed at the start of the month to 4.61 percent on New Year’s Eve, according to Mortgage News Daily. Still, the expectation in financial markets is that mortgage rates will rise throughout 2019, and the December drop was just a temporary correction. Rates are still higher than they were one year ago.

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