Consumers expect rates and home prices to decline in the coming year but they remain cautious about the market and affordability.
WASHINGTON – Consumers reported significantly greater optimism about the future direction of mortgage rates despite showing little change in overall homebuying sentiment, according to Fannie Mae Home’s Purchase Sentiment Index, which increased 0.6 points in August to 72.1,
In August, a survey-high 39% of consumers said they expect mortgage rates to decline in the next 12 months, up from 29% the month prior. This compares to 35% who expect mortgage rates to stay the same and 26% who expect rates to increase. A greater share of consumers also indicated that they expect home prices to decrease over the next 12 months, although the plurality continues to expect prices to increase.