Americans' economic fears are starting to subside with attitudes about personal finances, housing and employment improving, Fannie Mae said.
Fannie ties this upswing in confidence to job gains made in recent months. A report from Automatic Data Processing Wednesday shows the private sector added 216,000 jobs last month.
Respondents to Fannie's national housing survey in February expect home prices to increase 0.8% on average over the next 12 months, while 15% believe home prices will fall and 53% believe prices will remain the same.
The number of Americans who see this as a good time to sell rose to 13%, the highest level in a year, but still low. Respondents who think it’s a good time to buy fell to 70%.
About 45% of respondents expect rental prices will rise at least 3.5% over the next 12 months, a slight increase from January. Americans still show a strong desire to own a home with 65% of respondents planning to buy their next residence, while 29% expect to rent.
"The pickup in the pace of hiring over the past few months has helped soothe consumer concerns, lifting their moods regarding their personal finances, the direction of the economy, and their views on the housing market," said Doug Duncan, vice president and chief economist of Fannie Mae. "As a result, we’ve seen more potential for economic upside, creating a more balanced near-term outlook."
Fannie said 35% of Americans believe the economy is on the right track, up 19 percentage points from November. Still, 57% believe the economy is on the wrong track and 67% claim they are not concerned about losing their job.
In February, only 12% of Americans interviewed for Fannie's monthly survey said their financial situation will worsen over the next 12 months, a drop of three percentage points from January and at the lowest value recorded in more than a year.
Meanwhile, 16% of respondents said their income is now significantly lower than 12 months ago and 63% said their income is the same, while one-third noted expense increases over the past year.