Housing Survey: Americans Pessimistic, but ‘Would Buy’ If They Had to Move

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Pity the American consumer, especially when it comes to housing. A large proportion of those surveyed (43%) in a recent Fannie Mae poll about homeownership and the economy report that their expenses are “significantly higher” than 12 months ago. The size of this stressed segment (my words, not Fannie Mae’s) has increased for the fifth straight month in a row.

Specifically regarding housing, those polled expect housing prices to decline by 1.1% over the next 12 months, while they expect rental prices to go up by 3.3% over the next 12 months. Perhaps as a result of those price expectations, 63% of those polled would buy a home if they had to move.

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Only 10% described now as a “good time to sell,” up 1% from theĀ August data.

It’s tough to use the Fannie Mae survey to track attitudes toward housing over time because the questions change. In the third quarter of 2010, for instance, the question was not, “Is it a good time to sell your house?” but rather, “Is it a bad time to sell your house?” At that time, 85% of Americans agreed and said it was a bad time. Does that mean that the other 15% thought it was a good time? Technically, we can’t assume that.

However, for one idea of how markedly consumer attitudes have changed, look at the 2001 survey (at that point, surveys were only done annually). Some of the questions have to do with then-emerging technology: Do you have access to the Internet at home or at work? Would you consider applying for a mortgage online?

The answers, by the way, were that 71% of those polled had some kind of Internet access, while 38% “probably would not try” applying for a mortgage online. Sadly, we don’t know what the current answers to those questions would be, because — perhaps in recognition to the current omnipresence of technology — Fannie Mae no longer bothers to ask them.

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We can see from looking at the 2001 survey just how high interest rates were a mere 10 years ago. In that survey, 22% of all borrowers reported paying mortgage rates above 8% (another 11% didn’t know what their rates were). Sixty-eight percent of credit-impaired borrowers were paying rates above 8%, with 45% of those reporting an interest rate above 10.5%.

Currently, mortgage rates aren’t a concern; perhaps listening to the Federal Reserve, which has vowed to keep rates low through 2013, 51% of poll respondents thought that interest rates would stay the same as they are now, while 11% thought they would go down. (Which will be a neat trick, as the 30-year-fixed mortgage rate, which just went below 4%, is at historic lows).

In contrast, what’s on consumers‘ minds is the economy, stupid. And on that subject, consumers are pessimistic. Some 77 percent of those surveyed said that the economy was on the “wrong track,” up 64 percent from those surveyed the same month a year before.

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