Fannie Mae's July national consumer attitudinal survey finds that Americans' attitudes about the economy, household finances, and homeownership are growing more pessimistic – with 70 percent of Americans believing that the economy is moving in the wrong direction, while only 23 percent think the economy is moving in the right direction. Key indicators show that more consumers across the country have diminished expectations for home prices and their personal finances, more are thinking about renting as a next step, and twice as many are reporting significantly higher expenses than incomes.
“The impact of recent financial market volatility on household wealth has been a setback to consumer confidence, which we’re seeing in our survey results and in Americans’ continued restraint in their willingness to take on additional financial commitments,” said Doug Duncan, vice president and chief economist of Fannie Mae. “Our overall July survey data, beyond the eleven indicators we present this month, show that most Americans think the economy is on the wrong track – the highest level of pessimism to date for this topic. The sluggish pace of job growth, coupled with this economic uncertainty, is clearly having an impact on consumers’ attitudes toward the housing market and their own personal financial situations.”
The survey found on average and consistent with June, Americans believe home prices will decline slightly over the next year. Only 11 percent of respondents say it is a good time to sell one’s home (similar to May and June 2011 survey results). Despite Americans’ expectations that rental prices will go up in the next 12 months, fewer Americans say they would buy their next home (down 5 percentage points) and more of those surveyed say they would rent (up by 3 percentage points).
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