It is a good time to sell or buy properties?
In October, the Fannie Mae Home Purchase Sentiment Index, a composite index designed to track the housing market and the willingness of consumers to sell or buy a home, gained 0.7 points to 81.7 for the third consecutive month.
Freddie Mac disclosed on Thursday that mortgage rates were the lowest ever reported in the nearly 50-year history of its survey. Last week, average rates were below 3 percent for the 15th straight week and mortgage rates broke their own record for the 12th time this year.
It is still up to discussion how long these low rates will last, but 13 members of the Federal Reserve’s Federal Open Market Committee said in September that they plan to keep the central bank’s benchmark rate close to zero by 2023.
While for prospective buyers and sellers, the state of the housing market shines brightly, the economy overall is showing some hesitation. According to Doug Duncan, senior vice president and chief economist at Fannie Mae, the barely-there rise for October was triggered by a difference in purchasing sentiment and personal finance sentiment.
“As we saw after the 2016 elections, the ongoing progression of the pandemic and the 2020 election results can have longer lasting and unpredictable effects on consumer sentiment, and we expect both factors to shape the housing market over the coming months,” Duncan said.
In October, customers were increasingly worried about their job status and household income. The percentage of respondents who said they were not worried about losing their job in the next 12 months dropped from 83% to 79%, while the percentage who said they were worried rose from 16% to 21%.
The number of respondents who say their household income is “significantly lower” than it was 12 months ago rose from 17% to 20% and decreased from 59% to 55% for those who say it remained the same. Unemployment estimates for October dropped to 6.9 percent on Friday, the first time unemployment fell below half of the record high 14.7 percent peak in April. But that still leaves 11.1 million Americans reported to be unemployed.
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