Fannie May Survey Shows Home Buyers are not in a Hurry
An uncertain economy with no sense of urgency to lock in on a low rate leaves little incentive to move quickly
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- Written by Banking Exchange staff
![Fannie May Survey Shows Home Buyers are not in a Hurry](/media/k2/items/cache/276f2c405ca1337a966551d46951f391_M.jpg?t=20190909_192851)
On the surface, the residential real estate market looks like it could take off in the United States. Consumer sentiment towards housing improved in August with potential buyers and sellers being optimistic about real estate growth.
Americans also feel wealthier as the stock market is again near an all-time high this week, and mortgage rates continue to fall. Those three trends would normally mean optimism for residential properties to increase in value.
However, according to a Fannie Mae survey, there are plenty of reasons to think otherwise. More people are concerned about losing their job in 2020 than in the previous two years, and the real estate market is actually softening with real estate agents noticing that buyers are not in a rush.
While mortgage rates are the lowest in three years, the effect seems to be more on the refinance market rather than new buyers. While there are buyers out there shopping, there are little to no bidding wars as the buyers are cautious.
In fact, according to Fannie Mae, the interest rate decline is actually in part due to an uncertain economic environment. The mortgage rates, rather than creating an increase in value, will simply keep things favorable and stabilize the industry.
Overall home prices are higher than one year ago with gains slowing but still steady. As home mortgages continue to be appealing on out of pocket cost, it may help landlords even more than buyers. For Americans that already own property, they can take advantage of low mortgage rates and high rent as people are still waiting on the sidelines.
The prices may not go up, but the steady rents landlords have enjoyed for a number of years will not go away anytime soon. The mortgage rate is a full point lower than a year ago, and most analysts predict a further drop in rates.
The combination of an uncertain economy with no sense of urgency to lock in on a low rate leaves little incentive to move quickly into the market for those consumers who are not already in.
Tagged under Mortgage Credit, The Economy, Mortgage, Mortgage Compliance, Mortgage/CRE, Feature3, Feature, Financial Research,
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