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Examining American Housing Market Sentiment


The Fannie Mae Home Purchase Sentiment Index (HPSI) dipped slightly in February, decreasing 0.5 points to 92.5 but remaining near its survey high of 93.8. Three of the six HPSI components decreased month over month, including the percentage of Americans who believe that now is a good time to buy a home. Year over year, the HPSI is up 8.2 points, reflecting in part consumers’ more favorable mortgage rate expectations, despite that index component moderating this month.

“The HPSI remained relatively steady in February, reflecting another month of robust consumer sentiment consistent with strong housing market data to start the year,” said Doug Duncan, SVP and Chief Economist. “In particular, household income sentiment picked back up as more workers saw their wages rise amid tight labor market conditions, helping bolster already strong housing demand. Though American consumers’ optimism about the direction of the economy is higher this month than at any point in the survey’s nearly ten-year history, the late February stock market decline, precipitated in part by evolving expectations of the potential economic impact of the coronavirus, is not fully reflected in this month’s results due to the timing of our survey data collection, which ended February 22. We may see some volatility in sentiment in the months ahead as these circumstances play out.”

According to the survey, 59% of Americans believe now is a good time to buy, unchanged from the previous month, while the percentage who say it is a bad time to buy increased from 30% to 32%. As a result, the net share of Americans who say it is a good time to buy decreased 2 percentage points.

The percentage of Americans who say mortgage rates will go down in the next 12 months increased this month from 7% to 8%, while the percentage who expect mortgage rates to go up increased from 33% to 38%. The share who think mortgage rates will stay the same decreased from 48% to 46%. As a result, the net share of Americans who say mortgage rates will go down over the next 12 months decreased 4 percentage points.

by Seth Welborn (via

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