Most consumers now think they qualify for a mortgage

February 12, 2014
Author: 2014 Florida Realtors®

More Americans now believe it would be easy for them to get a mortgage, according to Fannie Mae’s January 2014 National Housing Survey results.

Positive consumer attitudes regarding the ease of a mortgage application climbed 2 percentage points to an all-time survey high of 52 percent, while those who think it would be difficult dropped 3 points to 45 percent – an indication that consumers view mortgage credit as more accessible.

While Freddie Mac still predicts more moderate home price gains over the next 12 months, consumers’ view that mortgage credit is more available may allow for continued but measured improvement in the housing recovery.

Consumer attitudes about the economy also improved in January despite downbeat jobs data for the past two months. The share of consumers who believe the economy is on the right track climbed 8 percentage points to 39 percent, while the share who believe it’s on the wrong track declined to 54 percent. Additionally, the share who expect their personal financial situation to improve in the next year increased to 44 percent, continuing an upward trend since November 2013.

“For the first time in the National Housing Survey’s three-and-a-half-year history, the share of respondents who said it is easy to get a mortgage surpassed the 50-percent mark, exceeding those who said it would be difficult by 7 percentage points,” says Doug Duncan, senior vice president and chief economist at Fannie Mae.

“The gradual upward trend in this indicator during the last few months bodes well for the housing recovery and may be contributing to this month’s increase in consumers’ intention to buy rather than rent their next home,” he adds. “The dip in overall home price expectations, though notable, is consistent with our view of moderating home price gains this year from a robust pace last year, while positive trends in perceptions about the economy and personal finances over the next year support our view of stronger growth in the broader economy.”

Survey highlights

Homeownership and renting

The average 12-month home price change expectation decreased from last month to 2.0 percent.
The share of people who say home prices will stay the same in the next 12 months increased 7 percentage points to 45 percent, while the share who say home prices will go up in the next 12 months fell by 6 percentage points to 43 percent.
The share of respondents who say mortgage rates will go up in the next 12 months decreased by 2 percentage points to 55 percent.
Those who say it is a good time to buy a house decreased from last month, down 2 percentage points to 65 percent.
Those who say it is a good time to sell a house increased 5 percentage points from last month to 38 percent.
The average 12-month rental price change expectation decreased from last month to 2.8 percent, tying the all-time survey low.
Forty-eight percent of those surveyed said home rental prices will go up in the next 12 months, a decrease of 5 percentage points from last month.
The share of respondents who said they would buy if they were going to move hit an all-time survey high of 70 percent, and those who say they would rent is at an all-time low of 26 percent.

The economy and household finances

The share of respondents who say the economy is on the right track increased 8 percentage points from last month, to 39 percent.
The percentage of respondents who expect their personal financial situation to get better in the next 12 months increased over last month to 44 percent.
The share of respondents who say their household income is significantly higher than it was 12 months ago decreased slightly to 22 percent.
At 32 percent, the share of respondents who say their household expenses are significantly higher than they were 12 months ago rose 2 percentage points from last month.

The Fannie Mae National Housing Survey polled 1,000 Americans via live telephone interview. Homeowners and renters are asked more than 100 questions used to track attitudinal shifts.