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Americans Express Widespread Pessimism on Economy and Housing Market
A significant majority of Americans believe the nation’s economy is headed in the wrong direction and that it’s a bad time to buy a home, according to the latest Home Purchase Sentiment Index from Fannie Mae. The survey, released on October 8, highlights widespread consumer apprehension regarding financial prospects and the housing market.
Nearly 70% of respondents indicated the economy is on the wrong track, while a substantial 73% felt that now is an unfavorable time to purchase a house. In contrast, only 32% believe the economy is moving in a positive direction, and just 27% consider it a good moment for home buying.
These figures present a mixed picture when compared to a year ago. In October of last year, 64% thought the economy was on the wrong track, and an even higher 81% considered it a bad time to buy a home, suggesting a slight shift in some sentiments but continued overall negativity.
Fannie Mae’s Home Purchase Sentiment Index, derived from six key questions in its National Housing Survey, aims to track consumers’ attitudes toward housing. The Federal National Mortgage Association, commonly known as Fannie Mae, plays a crucial role in the mortgage market by purchasing mortgages from lenders.
The recent survey gathered responses from 1,086 household decision-makers aged 18 and older between September 2 and 22, carrying a margin of error of 3.79%.
These findings align with other recent polls. A separate survey released this week revealed 53% of registered voters believe the economy is on the wrong track, with 37% seeing it on the right track. Additionally, a research center’s survey, released Friday, found that 74% of U.S. adults rate the economy as fair or poor, while only 26% described it as good or excellent.
The peak of pessimism regarding home buying in Fannie Mae’s historical polling was recorded in September 2023, when 84% believed it was a bad time to purchase a home, with only 16% holding a positive view.
Consumers also expressed caution about their personal finances for the coming year. Just 32% anticipate an improvement, 23% expect a worsening situation, and 45% foresee no change.
Regarding future home prices, 40% of those surveyed expect an increase over the next year, 22% predict a decrease, and 38% believe prices will remain stable.
“The bottom line is that the labor market is at a standstill, where workers are not getting hired or voluntarily changing jobs,” noted Torsten Slok, Chief Economist at Apollo Global Management.
While the September unemployment rate was unavailable due to a government shutdown, it stood at 4.32% in August. Despite economic concerns, employment confidence remains relatively strong, with 75% of working respondents reporting no concern about job loss in the next year, compared to 23% who are concerned.
The housing market’s dynamics are closely linked to interest rates. The average 30-year fixed mortgage rate stood at 6.34% last week, according to the Federal Reserve Bank of St.
Louis, a slight decrease from 6.72% at the end of October last year. Historically, rates have fluctuated significantly, reaching a low of 2.77% in January 2021 during the COVID-19 pandemic and a high of 18.53% in October 1981 during a recession.
The median price for a home sold in the United States in the second quarter of 2025 was reported at $512,800, a slight dip from $514,000 in the first quarter, according to the St. Louis Fed.
“The reality is that buying into the market, especially in Manhattan or prime Brooklyn, still requires a significant amount of cash upfront,” said Michelle Griffith, a luxury real-estate broker based in New York City. “Inventory is tight and competition is high, so the cost of the property itself is what keeps most buyers on the sidelines.”
Renters also anticipate rising costs, with an average increase of 6% expected over the next year. When asked about their housing preference, 67% would opt to buy, while 33% would choose to rent. However, 57% of respondents reported that obtaining a mortgage today would be difficult.