New data from a Fannie Mae survey indicates that consumer confidence in the housing market continues to rise, largely thanks to reduced unemployment and increased income growth.
New data from a Fannie Mae survey indicates that consumer confidence in the housing market continues to rise, largely thanks to reduced unemployment and increased income growth. According to the Wall Street Journal, Fannie Mae officials also warn that rising gas prices could be a potential drag on this predicted growth.
The survey in question, conducted in February, continued a modest upward trend in consumer confidence in home prices. Doug Duncan, chief economist for Fannie Mae, said that number has grown 19 percent since November 2011.
The Commerce Department released corresponding data on gross domestic product (GDP) in the same time period. Adjusted for inflation, statistics show 3 percent annual growth in the last three months of 2011, up from an earlier estimate of 2.8 percent.
As unemployment started to tick down at the end of 2011, Fannie Mae’s data shows Americans started spending more – personal consumption spending increased 2.1 percent in the fourth quarter. This was the most growth seen in three quarters.
Housing demand also increased in the fourth quarter, but roughly two-thirds of that demand was related to growing inventories.