Fannie Mae’s Home Purchase Sentiment Index (HPSI) dropped by 1.2 points from January to February and 16 points from a year ago.
Four of the six components of the HPSI decreased from January to February, including homebuying conditions. The number of respondents to Fannie Mae’s National Housing Survey who said it was a good time to buy a home dropped 10 percent month-over-month, while those who said it’s a good time to sell a home dipped 4 percent.
The HPSI indicates there was a 5-percent rise month-over-month in the respondents who expected home prices to go up, and a 3-percent drop in the number who expect mortgage rates to fall over the next year.
There was a drop of 9 percent month-over-month among those who said their household income is significantly higher than it was a year ago.
However, the HPSI did report a growing optimism about job security, with a spike of 14 percent month-over-month among those who say they are not concerned about losing their job.
“As we expected, the HPSI remained relatively flat in February, but underlying data indicate growing job-related optimism among consumers, especially among lower-income and renter groups,” Fannie Mae Senior Vice President and Chief Economist Doug Duncan said in a release. “With the growing likelihood that lockdown restrictions will continue easing as vaccination efforts ramp up, and with warmer weather on the horizon and another round of fiscal stimulus pending, these two segments of consumers may have good reason to feel more positive about the labor market.”
Duncan said the optimism is in line with a recent jobs report from the Bureau of Labor Statistics, which showed the strongest net gain in payroll employment since October.
“However, other components of the index remain well below pre-pandemic levels, so we believe there may still be room for improvement in housing and economic attitudes in the coming months, depending in part on the future path of mortgage rates,” he added.