American confidence in the ability to buy and sell a home ascended sharply in May due to recently strong home price gains, according to the Fannie Mae latest report.
The share of respondents who believe now is a good time to sell a home reached a record high of 40% in May, compared to 30% in April and 16% from the previous year.
On the other hand, the share of those who believe now is a good time to buy a home moved up 5 percentage points from April to a high of 76%.
Meanwhile, the average 12-month home price changed expectation also reached a record high, climbing to 3.9% in May, up from 2.7% in April.
"Sentiment toward selling a home appears to be catching up with the strengthening housing market," said Doug Duncan, senior vice president and chief economist at Fannie Mae.
He added, "The share of consumers who think it’s a good time to sell a home spiked this month, the largest increase in the survey’s three-year history. This jump may foreshadow a gradual return to more normal levels of housing supply from their lows of recent months. In turn, increased housing supply could serve to temper increasing consumer home price expectations."
Currently, 46% of Americans believe it would be easy to obtain a mortgage, dropping from April’s survey high, while 50% think it would be difficult to get a mortgage, the government-sponsored enterprise noted.
The share of respondents who say mortgage rates will go up increased 3 percentage points to 46%, while those who believe rates will go down hit a survey low of 5%.
Holding steady from last month, 48% of those surveyed say home rental prices will go up in the next 12 months, the survey found.
Meanwhile, 46% of respondents think it would be easy for them to get a home mortgage, retreating slightly from last month’s survey.
The share of respondents who said they would buy if they were going to move increased to 66% in May.
"We will closely watch the potential impact of rising mortgage rates on consumer housing sentiment in the coming months," Duncan concluded.