Confidence in housing is breaking new records, soaring in January in the Fannie Mae Home Purchase Sentiment Index® (HPSI). The HPSI overall posted 89.5 in January, 3.7 percentage points higher than the month prior and 6.8 percentage points higher than the year prior.
This increase can be attributed to homeowners recognizing sale value! Prices are rising steadily, and the belief is that they will continue to do so, which is shown through tracking recent sales.
According to Fannie Mae, HPSI rebounded from last month’s dip to a new survey high in January, in large part due to the spike in consumers’ net expectations that home prices will increase over the next year. However, results may continue to fluctuate over the coming months as consumers sort out the implications of the new tax legislation on their household finances. Over the past year, continued home price growth has helped spur a sizable increase in consumers who say it’s a good time to sell a home, but also a modest weakening in the net share who say it is a good time to buy.
In January, the share of homebuyers surveyed for the Index who believe now is a good time to buy rose three percentage points to 27 percent, while the share of sellers who believe now is a good time to sell rose four percentage points to 38 percent. The share of those who believe home prices will go up rose eight percentage points to 52 percent. Only time will tell for sure, but the tracking indicates more confidence in housing overall.