Fewer Americans think it is a good time to buy a home

Consumer confidence in the housing market receded from its record high in February, dropping 3.8 percentage points to a reading of 84.5 in March, according to Fannie Mae’s Home Purchase Sentiment Index, a survey of about 1,000 Americans.

Five of the six components declined, including the percentage of consumers who are optimistic about buying a home and their employment situation. However, the percentage of consumers who said it’s a good time to sell surged 9 percentage points month-to-month.

“Strong home-price appreciation has turned into a double-edged sword for the housing market,” says Fannie Mae chief economist Doug Duncan. “It boosted the net share of consumers saying it’s a good time to sell to a record high, surpassing the plunging ‘good time to buy’ indicator for the first time in history of the survey.

Duncan points says the housing market could see some “tailwinds from a seasonal rise in for-sale inventory, particularly as some sellers seek to lock in profits from recent rapid home-price gains. The market could also get a boost from home buyers who decide to jump into the market before [mortgage] rates rise further.”

Highlights from Fannie Mae’s Home Purchase Sentiment Index for March

• 30 percent: Net share of Americans who say it’s a good time to buy a home, down 10 percentage points from February.
• 31 percent: Net percentage of those who say it’s a good time to sell, up 9 percentage points from February and the second consecutive month for setting a survey high.
• 39 percent: Percentage of consumers who say it’s a bad time to buy due to high home prices.
• 24 percent: Percentage of consumers who say it’s a good time to sell due to high home prices.
• 44 percent: Net share of consumers who believe home prices will rise, down 1 percentage point from February.
• 70 percent: Net share of Americans who say they’re not concerned about losing their job, down 8 percentage points.
• 11 percent: Net share of consumers who say their household income is significantly higher than it was 12 months ago, down 8 percentage points.

Source: Florida Realtors