The home purchase sentiment index rose 2.1% in February. (iStock)
The spring buying season is heating up as more homes hit the market and homebuyers are eager to make purchases now that the winter frosts have subsided.
fannie mae’s Home purchase sentiment indexThe index showing home sales rose 2.1 points in February. This is the third consecutive month that the index has increased.
This increase is mainly due to the optimistic mood gradually permeating the real estate market as the sales situation improves slightly.
“The HPSI has risen for the third month in a row, continuing a slow but steady rise from the low plateau observed through most of 2023, and consumer sentiment for housing is now firmly in line with where it was this time last year. Fannie Mae’s senior vice president said. President Doug Duncan said:
The percentage of prospective home buyers who think now is a good time to buy has increased to 19%, but many buyers remain pessimistic.
This pessimism mainly stems from the housing price situation. About 42% of respondents surveyed in the Fannie Mae report expect home prices to rise in the next 12 months, up from 37% a year ago.
Potential buyers are also less positive about the current state of mortgage rates. The number of survey respondents who think interest rates will fall in the next 12 months fell from 36% to 35%.
“Lower mortgage rates and the associated increase in sentiment clearly bodes well for next spring’s home buying season,” Duncan said.
“However, affordability will remain a major challenge for buyers, at least until net supply increases significantly.”
Interest rates remain lower than they were at the height of the pandemic, so if you’re ready to take advantage of these low rates, now might be the time to consider a mortgage. Sites like Credible allow you to view multiple mortgage lenders and provide personalized interest rates in just minutes without affecting your credit.
Homebuyers considering buying a smaller home or a fixer-upper to combat rising home prices.
Newly built homes remain popular
With fewer existing homes on the market during the pandemic, new construction has become a haven for buyers. New construction remains popular with many buyers. Last year, more than half of prospective buyers preferred to look for a new home. Jiro Study found.
Among buyers who wanted a new home, 42% said they were only interested in new construction. This is an increase of 6 percentage points for him starting in 2022 and 10 percentage points starting in 2021.
Residential properties are generally available to the public all over the country. Total home listings increased 3.8% in February compared to the previous month. According to Redfin. This was the largest increase in the past six months.
“The housing market isn’t where it was two years ago during the pandemic home buying frenzy, but it’s better than last year. It’s coming back,” said David Palmer, a Redfin Premier real estate agent in Seattle. .
If you think you’re ready to consider a mortgage, consider using Credible, which makes it easy to compare interest rates from multiple lenders in minutes.
Gen Z immigrants are heading to warmer climates despite paying higher housing costs: Zillow
Mortgage interest rates are no longer expected to fall below 6% this year.
Last month, mortgage rates were expected to be around 5.9% at the end of the year, while 30-year fixed mortgages are expected to hover around 6.4% at the end of the year. fannie mae estimates In the latest interest rate forecast.
The Fed has not cut interest rates as aggressively, citing improved employment data and higher-than-expected inflation.
Doug Duncan: “Better-than-expected inflation data and strong employment numbers will put more upward pressure on mortgage rates this year than previously expected as markets continue to evolve their expectations for future monetary policy.” It’s very likely.”
“Still, while we do not expect the supply of homes for sale to increase dramatically, we do expect the level of market transactions to increase compared to 2023, even though mortgage rates remain high. .”
To see what mortgage rates you’re eligible for based on your current credit score and salary, consider visiting Credible, which allows you to compare multiple mortgage lenders at once.
Lower mortgage rates save homebuyers thousands of dollars: REDFIN
Have a finance-related question but don’t know who to ask? Email it to your trusted money expert. Moneyexpert@credible.com Your questions may be answered in Credible’s Money Expert column.
