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Housing Sentiment Returns to Near-Survey Low Amid Affordability Constraints and Job Security Concerns

Housing Sentiment Returns to Near-Survey Low Amid Affordability Constraints and Job Security Concerns
PR Newswire
WASHINGTON, March 7, 2023

Both Homebuyers and Home-Sellers Express Caution About Current Market Conditions
WASHINGTON, March 7, 2023 /…

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Housing Sentiment Returns to Near-Survey Low Amid Affordability Constraints and Job Security Concerns

PR Newswire

WASHINGTON, March 7, 2023

Both Homebuyers and Home-Sellers Express Caution About Current Market Conditions

WASHINGTON, March 7, 2023 /PRNewswire/ -- The Fannie Mae (OTCQB: FNMA) Home Purchase Sentiment Index® (HPSI) decreased 3.6 points in February to 58.0, breaking a streak of three consecutive monthly increases and returning the index closer to its all-time survey low set in October 2022. Overall, four of the HPSI's six components decreased month over month, most notably those associated with job security and home-selling conditions. While both components remain positive on net, in February 44% of consumers reported that it's a bad time to sell a home, up from 39% last month, and 24% expressed concern about losing their job in the next 12 months, up from 18% last month. Year over year, the full index is down 17.3 points.

"The HPSI declined this month and is now just slightly above the survey low set late last year," said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. "The decline was partly driven by a substantial decrease in consumers' sense of home-selling conditions, with most respondents who indicated it's a 'bad time to sell' citing unfavorable economic conditions and mortgage rates as the primary reasons for that belief. With home-selling sentiment now lower than it was pre-pandemic – and homebuying sentiment remaining near its all-time low – consumers on both sides of the transaction appear to be feeling cautious about the housing market. We believe these results corroborate our expectation for subdued home sales in the coming quarters, particularly now that mortgage rates have begun rising again. Additionally, this month's survey indicated an increase in job security concerns, which we'll continue to monitor closely, since labor market uncertainty could play yet another factor in slowing housing activity."

Home Purchase Sentiment Index – Component Highlights

Fannie Mae's Home Purchase Sentiment Index (HPSI) decreased in February by 3.6 points to 58.0. The HPSI is down 17.3 points compared to the same time last year. Read the full research report for additional information.

  • Good/Bad Time to Buy: The percentage of respondents who say it is a good time to buy a home increased from 17% to 20%, while the percentage who say it is a bad time to buy decreased from 82% to 79%. As a result, the net share of those who say it is a good time to buy increased 5 percentage points month over month.
  • Good/Bad Time to Sell: The percentage of respondents who say it is a good time to sell a home decreased from 59% to 54%, while the percentage who say it's a bad time to sell increased from 39% to 44%. As a result, the net share of those who say it is a good time to sell decreased 10 percentage points month over month.
  • Home Price Expectations: The percentage of respondents who say home prices will go up in the next 12 months decreased from 32% to 30%, while the percentage who say home prices will go down decreased from 37% to 35%. The share who think home prices will stay the same increased from 30% to 33%. As a result, the net share of those who say home prices will go up increased 1 percentage point month over month.
  • Mortgage Rate Expectations: The percentage of respondents who say mortgage rates will go down in the next 12 months increased from 13% to 15%, while the percentage who expect mortgage rates to go up increased from 52% to 55%. The share who think mortgage rates will stay the same decreased from 33% to 28%. As a result, the net share of those who say mortgage rates will go down over the next 12 months decreased 1 percentage point month over month.
  • Job Loss Concern: The percentage of respondents who say they are not concerned about losing their job in the next 12 months decreased from 82% to 73%, while the percentage who say they are concerned increased from 18% to 24%. As a result, the net share of those who say they are not concerned about losing their job decreased 15 percentage points month over month.
  • Household Income: The percentage of respondents who say their household income is significantly higher than it was 12 months ago remained unchanged at 22%, while the percentage who say their household income is significantly lower increased from 10% to 12%. The percentage who say their household income is about the same decreased from 67% to 63%. As a result, the net share of those who say their household income is significantly higher than it was 12 months ago decreased 1 percentage point month over month.

About Fannie Mae's Home Purchase Sentiment Index
The Home Purchase Sentiment Index® (HPSI) distills information about consumers' home purchase sentiment from Fannie Mae's National Housing Survey® (NHS) into a single number. The HPSI reflects consumers' current views and forward-looking expectations of housing market conditions and complements existing data sources to inform housing-related analysis and decision making. The HPSI is constructed from answers to six NHS questions that solicit consumers' evaluations of housing market conditions and address topics that are related to their home purchase decisions. The questions ask consumers whether they think that it is a good or bad time to buy or to sell a house, what direction they expect home prices and mortgage interest rates to move, how concerned they are about losing their jobs, and whether their incomes are higher than they were a year earlier.

About Fannie Mae's National Housing Survey
The National Housing Survey (NHS) is a monthly attitudinal survey, launched in 2010, which polls the adult general population of the United States to assess their attitudes toward owning and renting a home, purchase and rental prices, household finances, and overall confidence in the economy. Each respondent is asked more than 100 questions, making the NHS one of the most detailed attitudinal longitudinal surveys of its kind, to track attitudinal shifts, six of which are used to construct the HPSI (findings are compared with the same survey conducted monthly beginning June 2010). For more information, please see the Technical Notes.

Fannie Mae conducts this survey and shares monthly and quarterly results so that we may help industry partners and market participants target our collective efforts to support the housing market. The February 2023 National Housing Survey was conducted between February 1, 2023 and February 19, 2023. Most of the data collection occurred during the first two weeks of this period.   The February 2023 NHS was conducted exclusively through AmeriSpeak®, NORC at the University of Chicago's probability-based panel, on behalf of PSB Insights and in coordination with Fannie Mae. Calculations are made using unrounded and weighted respondent level data to help ensure precision in NHS results from wave to wave. As a result, minor differences in calculated data (summarized results, net calculations, etc.) of up to 1 percentage point may occur due to rounding.

Detailed HPSI & NHS Findings
For detailed findings from the Home Purchase Sentiment Index and National Housing Survey, as well as a brief HPSI overview and detailed white paper, technical notes on the NHS methodology, and questions asked of respondents associated with each monthly indicator, please visit the Surveys page on fanniemae.com. Also available on the site are in-depth special topic studies, which provide a detailed assessment of combined data results from three monthly studies of NHS results.

To receive e-mail updates with other housing market research from Fannie Mae's Economic & Strategic Research Group, please click here.

About the ESR Group
Fannie Mae's Economic and Strategic Research Group, led by Chief Economist Doug Duncan, studies current data, analyzes historical and emerging trends, and conducts surveys of consumer and mortgage lender groups to provide forecasts and analyses on the economy, housing, and mortgage markets. The ESR Group was recently awarded the prestigious 2022 Lawrence R. Klein Award for Blue Chip Forecast Accuracy based on the accuracy of its macroeconomic forecasts published over the 4-year period from 2018 to 2021.

About Fannie Mae
Fannie Mae advances equitable and sustainable access to homeownership and quality, affordable rental housing for millions of people across America. We enable the 30-year fixed-rate mortgage and drive responsible innovation to make homebuying and renting easier, fairer, and more accessible. To learn more, visit: fanniemae.com | Twitter | Facebook | LinkedIn | Instagram | YouTube | Blog

Fannie Mae Newsroom
https://www.fanniemae.com/news

Photo of Fannie Mae
https://www.fanniemae.com/resources/img/about-fm/fm-building.tif

Fannie Mae Resource Center
1-800-2FANNIE

Opinions, analyses, estimates, forecasts, and other views of Fannie Mae's Economic & Strategic Research (ESR) Group or survey respondents included in these materials should not be construed as indicating Fannie Mae's business prospects or expected results, are based on a number of assumptions, and are subject to change without notice. How this information affects Fannie Mae will depend on many factors. Although the ESR Group bases its opinions, analyses, estimates, forecasts, and other views on information it considers reliable, it does not guarantee that the information provided in these materials is accurate, current, or suitable for any particular purpose. Changes in the assumptions or the information underlying these views could produce materially different results. The analyses, opinions, estimates, forecasts, and other views published by the ESR Group represent the views of that group or survey respondents as of the date indicated and do not necessarily represent the views of Fannie Mae or its management.

 

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UAW workers play hardball with General Motors

Striking United Auto Workers have upped the ante in the battle with GM over wages.

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October 24, 2023

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After reporting $3.5 billion in third-quarter profits, General Motors  (GM) - Get Free Report suffered yet another significant blow from striking United Auto Workers on Oct. 24. The union's latest decision is a bold move designed to force management to agree to a slate of terms, including higher wages, more retirement money, and additional time off.

GM workers with the UAW Local 2250 Union strike outside the General Motors Wentzville Assembly Plant on Sept. 15 in Wentzville, Mo. (Photo by Michael B. Thomas/Getty Images)

Michael B. Thomas/Getty Images

General Motors profits put it on the hot seat

General Motors argues UAW workers' wage demands would crimp its ability to invest in necessary technology, putting it at risk of losing market share to non-union competitors vying for a share of the emerging electric vehicle market.

Electric vehicle sales growth is far outpacing internal combustion engine (ICE) growth, a trend that's unlikely to change. In Q3, Cox Automotive's Kelley Blue Book reports electric vehicle sales in the U.S. skyrocketed 50%, increasing EV's share of total vehicle sales to 8%. 

Related: Former Ford CEO has a blunt warning for UAW union strikers

The stakes are undeniably high. 

General Motors' EV market share slipped against key rivals last quarter, a warning sign that it's already struggling to outmaneuver other carmakers. Wall Street analysts estimate EV sales will comprise 40% of all vehicles sold in America in 2030.

General Motors must spend big money if it hopes to remain the nation's biggest automaker. However, claims General Motors can't afford to meet striking workers' demands have fallen flat with workers in the wake of record profitability. 

More Business of EVs:

The company's third-quarter sales exceeded $44 billion, up 5% from one year ago, and earnings per share totaled $2.28 per share, up slightly from last year. The company has pocketed about $10 billion in profits through the first nine months of this year.

UAW workers target a crucial source of  General Motors' profit

Given General Motors' record earnings and stalled contract negotiations, the union has turned its attention to General Motors' biggest cash cow. 

Workers walked off the assembly line at Arlington Assembly on Oct. 24, halting production of the highly profitable Chevy Tahoe, Chevy Suburban, GMC Yukon, and Cadillac Escalade, at General Motors' largest plant.

“Another record quarter, another record year. As we’ve said for months: record profits equal record contracts,” said UAW President Shawn Fain. “It’s time GM workers, and the whole working class, get their fair share.”

So far, General Motors has offered striking workers less than Ford Motors  (F) - Get Free Report,  

According to a UAW statement, Ford's deal includes a better path to top wages, more retirement money, and a more compelling cost-of-living plan to account for annual inflation than General Motors' offer.

Initially, union workers demanded a 40% pay increase, a return to pensions, a 32-hour workweek, cost-of-living increases, a faster pathway to top wages, and other perks.

They rejected a General Motors offer earlier this month that included a 20% pay increase, a reinstatement of COLA inflation adjustments for top-wage tier workers in year two, reducing how long it takes to reach its top wage tier to four years, an increase in temporary worker pay to $20 per hour, and a boost to 401(k) retirement contributions to 8% from 6.4%.

The decision to expand the strike to Arlington Assembly increased the number of workers participating in its stand-up strike against General Motors, Ford Motors, and Stellantis to 45,000 across eight plants and 38 parts distribution centers. 

Overall, the UAW boasts nearly 150,000 members.

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Key Market Relationships for the Next Big Move

First off, we are heading out of town to New York where I will be visiting in studio several media channels and hosts.Then, we are off to Orlando for the…

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October 24, 2023

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First off, we are heading out of town to New York where I will be visiting in studio several media channels and hosts.

Then, we are off to Orlando for the MoneyShow.

On November 1st, Keith and I go on vacation until the middle of the month.

This is the last Daily I will be writing for a while.

However, I will have several clips in the next few days to share, and Geoff Bysshe will occasionally write the Daily in my absence.

That said, today, I began the day with the Benzinga Market Prep Show.

I am featuring this today as content because I hope it helps you look at the market objectively.

We did not discuss inflation, which, as you are aware, I believe can go hyper as geopolitical stress, social unrest, strikes for higher wages, and mother nature could each, or worse, all, kick into gear.

We discussed bonds, small caps, commercial real estate, retail, and a couple of stocks.

In that discussion, and on the heels of Bill Ackman's statements along with our technical indicators, we spell out the exact relationships to watch.

Monday's Daily explained how much long bonds factor into the equity (and commodity) equation.

We also cover small caps and the monthly charts, along with SPY, QQQ, Transports (IYT), and Retail (XRT).

If the decades have taught me anything, it's that the simpler you can make the definitions, the better the comprehension.

It is with that in mind that we show you how easy it will be in just a short time to see where this market heads next.

Benzina Pre-Market Prep

In addition to the analysis, Joel and I talk about the floor days and how we figured out momentum with our senses!

Plus, we go over a couple of picks.

Thank you all for your continued readership and support.

I hope you have many profitable weeks.

Happy Trading.

This is for educational purposes only. Trading comes with risk.

If you find it difficult to execute the MarketGauge strategies or would like to explore how we can do it for you, please email Ben Scheibe at Benny@MGAMLLC.com, our Head of Institutional Sales. Cell: 612-518-2482.

For more detailed trading information about our blended models, tools and trader education courses, contact Rob Quinn, our Chief Strategy Consultant, to learn more.

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Grow your wealth today and plant your money tree!

"I grew my money tree and so can you!" - Mish Schneider

Follow Mish on Twitter @marketminute for stock picks and more. Follow Mish on Instagram (mishschneider) for daily morning videos. To see updated media clips, click here.

Mish in the Media

Mish covers the bond rally and how the consumer could save the day in this video.


Hear Mish's thoughts on earnings, the macro environment, and her three stock picks on Bloomberg BNN.

Ever thought of owning commodities? Hear what Mish says about the key commodities you should consider in this video.


Mish participates in Crypto Town Hall X Space. You can sign in to your X account and watch it here.

In this video, Mish talks about trading Garmin Ltd. (GRMN) on Business First AM.


Mish and Dale Pinkert discuss the disconnect between news and markets-and how to best invest right now in this video from ForexAnalytix's pre-market show.


In this video from CMC Markets, Mish shares her short-term forecast for USD/JPY and popular commodity instruments ahead of the US PPI announcement and September's Fed meeting minutes, with recent dovish comments from Fed officials suggesting a potential shift in the committee's policies.


Mish joins Business First AM to discuss the market reaction to the war in Gaza in this video.


Mish covers bonds, small caps, transports and commodities-dues for the next moves in this video from Yahoo! Finance.


In this video from Real Vision, Mish joins Maggie Lake to share what her framework suggests about junk bonds and investment-grade bonds, what she's watching in commodity markets, and how to structure a portfolio to navigate both bull and bear markets.


Coming Up:

October 26: Cheddar TV on the NYSE

October 27: Live in-studio with Charles Payne, Fox Business

October 27: Live in-studio with Yahoo Finance!

October 27: Recorded in-studio with Investor's Business Daily

October 29-31: The Money Show

Weekly: Business First AM, CMC Markets

November 1–13 VACATION

ETF Summary

  • S&P 500 (SPY): 417–420 support
  • Russell 2000 (IWM): 170 now in the rearview mirror
  • Dow (DIA): 332 pivotal
  • Nasdaq (QQQ): 351 recent low and support
  • Regional Banks (KRE): 35 next support
  • Semiconductors (SMH): 140 support.
  • Transportation (IYT): 225 pivotal
  • Biotechnology (IBB): 120 pivotal
  • Retail (XRT): 57 key support still


Mish Schneider

MarketGauge.com

Director of Trading Research and Education

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Elizabeth Warren uses Hamas as her newest scapegoat in war on crypto

Massachusetts Sen. Elizabeth Warren is taking advantage sensationalist claims related to Hamas’ use of crypto. Unfortunately, those claims are largely…

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October 24, 2023

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Massachusetts Sen. Elizabeth Warren is taking advantage sensationalist claims related to Hamas' use of crypto. Unfortunately, those claims are largely false.

Massachusetts Sen. Elizabeth Warren is at it again. With mainstream press outlets including Germany’s Deutsche Welle running sensationalist headlines — “How cryptocurrency fueled Hamas’ terrorist attack” — Warren is using Hamas’ attack on Israel to fuel her own war on cryptocurrency.

Crypto’s role in the conflict came into focus on Oct. 10, when Israeli police froze crypto accounts used for donations to Hamas. It was not the first time. In 2021, Israel’s Terror Financing of Israel (NBCTF) seized crypto wallets linked to a Hamas fundraising campaign.

While Binance worked “closely with international counter-terrorism authorities" on the seizures, Warren led a group of more than 100 U.S. lawmakers in sending the Biden administration a letter letter asking it to crack down on Hamas and its affiliates’ cryptocurrency wallets — despite the organization’s relative struggle to raise crypto as part of its fundraising efforts.

“Congress and this administration must take strong action to thoroughly address crypto illicit finance risks before it can be used to finance another tragedy,” the letter said.

The lawmakers requested that the Biden administration also provide estimates on the value of crypto assets that remain in Hamas-controlled wallets, how much of Hamas’ operations are funded through crypto, and any information it has on the actors facilitating the sending of crypto to and from Hamas and other militant groups.

The U.S. Treasury Department sanctioned Gaza-based crypto broker “Buy Cash Money and Money Transfer Company (Buy Cash)” on Oct. 18, revealing it had been used for a whopping $2,000 Bitcoin transaction — a paltry sum compared to the hundreds of millions of dollars used to fund Hamas. One sanctioned wallet had $16 in it.

“We will continue to take all steps necessary to deny Hamas terrorists the ability to raise and use funds to carry out atrocities and terrorize the people of Israel,” said Treasury Secretary Janet Yellen. “That includes by imposing sanctions and coordinating with allies and partners to track, freeze, and seize any Hamas-related assets in their jurisdictions.”

Terrorists’ use of cryptocurrency has been dramatically overstated. The dollar remains the key tool for money launderers, with crypto playing a relatively tiny role. Why would terrorists use blockchain when its transactions can be tracked? Beyond this, terrorists arguably have little need for crypto when they have the ability to siphon aid funds from the international community. The United Nations spent nearly $4.5 billion in Gaza from 2014-2020, including $600 million in 2020 alone, even as Hamas reportedly turned European Union-funded water pipelines into home-made rockets.

Elliptic.co, a blockchain-analysis provider, suggested in a report this month that Hamas did receive cryptocurrency around the time of the attack. However, Hamas has not used crypto as a primary source of funding, instead opting to use the banking system, money service businesses, as well as informal “hawala” transfers. This global financing network  launders funds from charities and friendly nations to Hamas. Hamas started publicly seeking funds in crypto in 2019 through its Telegram channel. The group now uses payment processors to create crypto addresses and hide its cryptocurrency wallets.

The bulk of anti-terrorism efforts should not focus on terrorist use of cryptocurrency, considering the diverse ways these organizations procure funds. “There’s not one financing method for Hamas or other terrorist organizations. They’re opportunistic and adaptive,” former CIA analyst Yaya Fanusie, now an adjunct senior fellow with the Center for a New American Security, said in an interview with CNN. “Efforts to stop them are a constant game of cat-and-mouse.”

Due to crypto’s transparent nature, it’s proven to be no secret when Hamas uses crypto, as made clear by the recent crypto freezing action. When it does use crypto, Hamas generally receives small-dollar donations, ultimately representing a small fragment of the organization’s considerable $300 million annual budget. It’s disingenuous to state that terrorist use of crypto is a credible threat relative to the fiat-denominated funds moving through these organizations.

Warren’s anti-crypto pet project appears to be a red herring, and ultimately distracts from more fruitful conversations about how terrorist organizations actually raise funds through the traditional financial system.

Kadan Stadelmann is a blockchain developer and the Komodo Platform’s chief technology officer. He graduated from the University of Vienna in 2011 with a degree in information technology before attending the Berlin Institute of Technology for technical informatics and scientific computing. He joined the Komodo team in 2016.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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