Another potentially negative wrinkle was Monday's bombing at the Boston Marathon. Consumers tend to pull back on spending after big terrorist attacks, although Americans are also a resilient lot who tend to shake off negative economic news sooner rather than later.
That’s apparently the case with the U.S. housing market, according to the latest Fannie Mae National Housing Survey.
The March survey — taken long before the Boston tragedy — shows that Americans are of two minds on the housing market and their own financial experiences.
For example, while the survey says more U.S. adults show “greater pessimism” on their financial situations, they are decidedly bullish on their home values, with 48 percent of survey respondents say the value of their homes will rise in the next 12 months and 26 percent saying now is a good time to sell, about double the figure last March.
Those numbers generally mirror data from JPMorgan Chase that show home prices to rise 7 percent in 2013. The bank says that one in three U.S. homes on sale in February sold within 30 days, and that the average time on the market dropped from 97 days last year to 74 days this year.
Fannie Mae executives say the housing market has taken on a life of its own, seemingly immune to potential trouble spots in the economy.
“Despite an uptick in concern expressed about the direction of the economy, it appears consumers believe that the housing recovery will march on,” says Doug Duncan, senior vice president and chief economist at Fannie Mae. “Housing sentiment remains unshaken from the highs of the last few months.”
That doesn’t mean consumers aren’t aware things could go south in a hurry. Only 35 percent of consumers surveyed by Fannie Mae believe the economy is on the right track, down from 38 percent in February.
“Perhaps driven by the experience of the past several years, consumers remain cautious in their housing outlook,” Duncan says. “While the survey shows a string of 17 positive one-year-ahead home price expectations through March, the average expected gains have remained below 3 percent. By comparison, main measures of national home prices in early 2013 posted year-over-year gains of at least double or triple that figure.”
By and large, however, U.S. consumers take a positive view of the housing market. Only 10 percent of consumers surveyed by Fannie Mae say home prices will go down, and the number of Americans who say it’s a good time to sell a home is at the highest level since June 2010.