Buoyed by rising consumer confidence about job security and an expected drop in mortgage rates, consumer sentiment in housing during January rose to its highest level since March 2022, Realtor.com reports.
Fannie Mae's monthly Home Purchase Sentiment Index (HPSI) was up 3.5 points in January, reaching 70.7—the index's highest level in almost two years. But homebuyers remain skittish, with the share of consumers who said it’s a good time to buy a home (17% in January) remaining unchanged from December.
In January, 82% of the survey respondents said they were not concerned about losing their job in the next 12 months, up from 75% the previous month.
The share of respondents who expect mortgage rates to go down in the next 12 months hit an all-time high of 36%, Fannie Mae said, up from 31% the previous month. The 30-year fixed-rate mortgage is averaging at 6.63% as of Feb. 1, according to Freddie Mac.
“For the first time in our National Housing Survey’s history, a greater share of consumers believe mortgage rates will decrease over the next year, rather than increase,” Doug Duncan, chief economist and senior vice president at Fannie Mae, said in a statement.