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New York Markets After Hours

May 20, 2023, 10:26 a.m. EDT

Is now a good time to buy a house? Only 20% of Americans say ‘yes’

By Aarthi Swaminathan

Both prospective homebuyers and sellers are feeling increasingly annoyed by the housing market and the economy, according to a new survey.

Their frustrations were registered by the Fannie Mae Home Purchase Sentiment Index, which dropped by 3.4 points in June to 64.8. That’s the second-lowest reading in a decade.

Consumers surveyed were pessimistic about home-buying conditions. Only 20% said that it was a good time to buy a house. 75% said it was a bad time to buy a home.

Sellers were also feeling less optimistic: The percentage of consumers who believe it’s a good time to sell fell from 76% in May 2022 to 68% last month.

“People appear to be growing increasingly frustrated with inflation and the slowing economy,” Doug Duncan, senior vice president and chief economist at Fannie Mae, said in a statement.

A significant share of consumers said they were worried about the future of the U.S. economy. 81% of those surveyed by Fannie Mae said that the economy is on the “wrong track” and a plurality of respondents said that they thought it would be difficult to get a mortgage — for the first time in seven years.

One-fifth of respondents also expressed concerns about job stability in the Fannie Mae survey, which was the “highest percentage in 18 months,” Duncan said.

Housing affordability is still a concern as mortgage rates and home prices continue to be much higher now than where they were a year ago.

The average on the 30-year fixed-rate mortgage stood at 5.3% as of Thursday. The median price for an existing home up for sale was $407,600 in May 2022 .

“As a whole, this month’s … results are consistent with our  forecast  of a slowing housing market through the rest of this year and next,” Duncan added.

Write to MarketWatch reporter Aarthi Swaminathan at: aarthi@marketwatch.com

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