Fannie Mae National Housing Survey

Fannie Mae has been conducting surveys of homeowners and renters to assess the attitudes towards the economy and the housing market. The first survey was taken in December 2003.  Subsequent surveys have been conducted in January 2010, June 2010, July-September 2010, and the latest version in October-December 2010.  While the absence of similar surveys between 2003 and 2010 limits the ability to assess longer-term changes in attitudes, the information is still very interesting and gives us an idea of how the general public views the current state of the housing industry.

PRICES AND COSTS OF HOUSING

Most Americans believe that now is a good time to buy a house (65%), roughly the same as the survey taken in January 2010.  Only 19% of respondents predict that home prices will fall in the next 12 months. 26% anticipate that home prices will increase, while 52% feel as though they will remain relatively flat.  Both the percentage of those who feel that home prices will rise and those who believe they will fall decreased from the January 2010 survey, with more people believing that home prices will remain flat.

On the rental market, 39% of those surveyed think rental prices will increase over the next 12 months, mostly unchanged from January 2010. Rental prices are predicted to rise by 2.8%, on average.

DESIRABILITY OF HOMEOWNERSHIP

Buying a home is still believed to be a safe investment by the majority of respondents, but the percentage who believe this has dropped. In the latest survey, 64% expressed a belief in housing as a safe investment. In January 2010 the percentage was 70% and in 2003 the survey found that 83% agreed with this statement.

And, yet, an overwhelming majority still see owning as more advantageous than renting. 84% of respondents indicated that owning a home makes more sense than renting. 61% indicated that they feel that paying rent is not a good investment.  However, looking at only those who are currently renting, 28% believe that renting makes more sense, an increase of 8% since January 2010. More telling, 79% of current renters believe they would have to make a financial sacrifice to own a home. 54% indicate that it would take a “great deal” of sacrifice.

Breaking down homeownership by age groups shows that, in general, the older the respondent, the more likely they are to own their home. 36% of members of Generation Y (18 to 34 years old) are homeowners, compared to 73% for Generation X (35 to 45 years old), 79% for baby boomers, and 85% for the oldest Americans.

HOUSEHOLD FINANCES

Household income has remained steady since January 2010 for 60% of respondents. 19% said that they had experienced a significant increase in income. As far as monthly expenses, 34% said they are facing significantly higher totals than they were in January 2010 while those who said their expenses are significantly lower only numbered 12%.

For those who are delinquent in their home mortgages, 47% indicated that their income has declined significantly and 21% report both higher expenses and lower incomes. 

Poor credit is the top reason given by those who are renting for not buying a home. 42% of renters believe their income is not sufficient for the expenses they have (73% of homeowners who are delinquent in the mortgages agreed with this statement).

DELINQUENCY

31% of those who are currently delinquent in their mortgage payments say they have considered defaulting on their loan, compared to 39% in January 2010. The vast majority of those surveyed disapprove of defaulting on a mortgage with 86% indicating that they believe this is not right.  Just 50% of those who are delinquent said that they would buy again. In this group, 53% believe that buying a home is a safe investment, down from 65% just last January.

To read the excerpts from the survey, please click here.
To read the complete analysis from the survey, please click here.

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About missionmortgage

A full-service professional mortgage banker providing lending in Texas for over 25 years. Our main office is located at 901 S. Mopac Expwy, Barton Oaks V- Suite 120, Austin, TX 78746 with branches in Lakeway, Houston, and Sealy. Mission Mortgage has been ranked as a Top 10 Mortgage Company in Austin for the past 7 years (Austin Business Journal).
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