The share of those surveyed in Fannie Mae’s recent Home Purchase Sentiment Index Survey who reported “significantly higher household income” in 2016 increased five points to 15 percent in January, while the share of those who reported it is “a good time to sell” a house increased two points, also to 15 percent. The share of those who reported home prices will rise increased seven points to 42 percent. The Index overall increased two points to 82.7—a historical high.
Three months after the presidential election, measures of consumer optimism regarding personal financial prospects and the economy are at or near the highest levels we’ve seen in the nearly seven-year history of the National Housing Survey according to Doug Duncan, chief economist at Fannie Mae.
“Any significant acceleration in housing activity will depend on whether consumers’ favorable expectations are realized in the form of income gains sufficient to offset constrained housing affordability,” Duncan says. “If consumers’ anticipation of further increases in home prices and mortgage rates materialize over the next 12 months, then we may see housing affordability tighten even more.”