Pessimism grew more prevalent for homebuyers in July, with the Fannie Mae Home Purchase Sentiment Index (HPSI) falling to its lowest level in 11 years.
Only 17 percent of those surveyed believe it’s a good time to buy a house while a declining number believe it’s a good time to sell a house (67 percent, compared to 76 percent in May).
While there is still healthy buyer demand for homes that are priced well and show well in the Rochester market, the national trends also are prevalent, according to Lanie Bittner, president of the Greater Rochester Association or Realtors (GRAR).
“We’re certainly seeing some effect of the economy,” Bittner said. “I think it’s a combination of inflation and mortgage rates. They’re paying more at the pump and more at the grocery store and saying ‘Now I can buy less of a house.’ ”
In the Fannie Mae survey, four of the six HPSI components decreased month over month, including the home price growth element.
“The HPSI has declined steadily for much of the year, as higher mortgage rates continue to take a toll on housing affordability,” Doug Duncan, Fannie Mae senior vice president and chief economist, said in a news release. “Unfavorable mortgage rates have been increasingly cited by consumers as a top reason behind the growing perception that it’s a bad time to buy, as well as sell, a home.
“Additionally, consumers appear to be indicating that selling conditions are softening, as the ‘Good Time to Sell’ component has declined meaningfully over the past two months, and, on net, fewer consumers expect home prices to go up.”
Duncan predicted continued mixed reactions in the market with sellers trying to take advantage of what they believe are higher selling points while buyers pull back and wait for prices to come down.
That’s why consultations with an agent can be so important, Bittner said.
“We’re seeing more price adjustments,” she said. “That’s the conversation agents are having with their sellers. Do we need to be a little more realistic with pricing?”
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