Americans Increasingly Glum on Housing, Economy

Fannie Mae's National Housing Survey for August indicates that Americans are growing more pessimistic about the economy, home prices and their own personal finances.  More than three-quarters of those responding to the survey said that the economy is on the wrong track, up from 70 percent in July and the highest percentage in over a year.  One year ago the figure was 60 percent.  Sixteen percent think it is on the right track compared to 23 percent one month earlier and 28 percent in August 2010.   

And in regard to housing

Household income has remained unchanged for the last 12 months for 61 percent of respondents, 21 percent have increased their income and 17 percent have lost ground.  These numbers are virtually unchanged from last month.  In August 2010 17 percent said their income had risen, 22 percent said it was lower than a year earlier, and 60 percent reported no change.  At the same time, expenses have risen significantly in the past year according to 41 percent of respondents compared to 35 percent one year ago and remained the same for 47 percent compared to 55 percent last year.  The month-to-month changes in the responses were minimal.

American attitudes toward home prices also the most negative in a year.  Twenty percent expect an improvement in home prices over the next year, down from 23 percent in July and 24 percent one year ago while 27 percent expect further deterioration compared to 24 percent in July and 19 percent in August 2010.  No change is expected by 49 percent.  In September 2010 Americans began to express confidence that prices on average would increase but August was the third month in a row when prices were expected to drop, this time by an average of -0.5 percent.   The expected change was -0.3 in July.

And one surprising finding.

Sixty-nine percent view this as a good time to buy a house, up from 66 percent in July and identical to responses one year ago.  The percentage who view it as an opportune time to sell decreased to 9 percent from 11 percent in July and 13 percent in August 2010.  Thirty-four  percent say their next home will be a rental, the same as in July and 2 percentage points more than a year ago while 62 percent would buy, up one point month-over-month and unchanged from last year

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