Persistently high mortgage rates are making people more pessimistic about the housing market
Americans are feeling worse about the housing market as mortgage rates stay elevated, according to Fannie Mae's latest survey of consumer attitudes.
Just 30% of respondents polled by Fannie Mae now expect mortgage rates to fall in the next 12 months, down from 35% in January. Thirty-three percent see mortgage rates rising, and 36% think they'll stay the same.
Those shifting views helped the Fannie Mae Home Purchase Sentiment Index decline 1.8 points in February to 71.6. It notched its first year-over-year decline in nearly two years, falling 1.2 points from February 2024.
Most of the survey was conducted in the first two weeks of February, when mortgage rates remained stuck around 6.9%. In recent weeks, they've fallen to 6.63% amid growing economic uncertainty and President Donald Trump's rapidly evolving tariff policies.
Meanwhile, 41% of survey respondents see home prices rising in the next 12 months from their already high levels.
'While some consumers may be slowly acclimating to the higher mortgage-rate environment, the vast majority continue to believe it is a 'bad time' to buy a home — with high home prices cited as the primary sticking point,' Mark Palim, Fannie Mae's senior vice president and chief economist, said in a statement.
Last month, 76% of survey respondents said they thought it was a bad time to buy a home, down slightly from January's 78%.
Consumers are also growing slightly more wary about their own financial positions. Twenty-three percent of employed respondents said they're concerned about losing their jobs in the next 12 months, up from 22% in January.
Learn more: How much house can I afford with a $70,000 salary?
The net percentage of respondents who reported their incomes had risen significantly in the last 12 months also fell one percentage point to 7%.
The Home Purchase Sentiment Index is derived from select questions from Fannie Mae's monthly National Housing Survey of about 1,000 adults. The February survey was conducted between Feb. 1 and Feb. 18.
Claire Boston is a Senior Reporter for Yahoo Finance covering housing, mortgages, and home insurance.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Insider
an hour ago
- Business Insider
Cantor Downgrades Joby Aviation Stock (JOBY) Due to Lack of Near-Term Upside
Cantor Fitzgerald downgraded electric vertical takeoff and landing (eVTOL) aircraft maker Joby Aviation (JOBY) to Hold from Buy with a price target of $9 due to a lack of near-term upside in the stock. While JOBY stock plunged about 8% on Thursday due to the rating downgrade, it has rallied 26.5% over the past month. As a result, the stock is up 9.1% year-to-date, thanks to a favorable executive order signed by U.S. President Donald Trump and the announcement of new deals. Confident Investing Starts Here: Indeed, the executive order would direct the Transportation Department to develop a program to accelerate eVTOL operations in the U.S., which is expected to benefit players like Joby Aviation and Archer Aviation (ACHR). This comes after Joby Aviation signed a Memorandum of Understanding (MoU) earlier this month with Abdul Latif Jameel to explore establishing a distribution agreement in Saudi Arabia for the company's electric aircraft. The agreement involves the potential delivery of up to 200 Joby aircraft and related services that are valued at about $1 billion. Cantor Moves to the Sidelines on JOBY Stock Interestingly, Cantor analyst Andres Sheppard admitted that Joby Aviation remains one of the best-positioned companies in the eVTOL sector, given its partnerships with Toyota (TM), Delta Air Lines (DAL), and the U.S. Department of Defense. However, the 4-star analyst finds JOBY stocks' valuation to be stretched, following a 60% rally over the past three months and an almost 90% gain in the past year. 'We don't see current levels as a good entry point for investors,' said Sheppard. The analyst noted that while Joby Aviation has solid liquidity, it also has one of the highest cash burn rates in the sector. In fact, the company ended Q1 2025 with about $1.3 billion in total liquidity, including Toyota's $250 million funding, but expects to spend between $500 million and $540 million in 2025. Additionally, Sheppard cautioned about delays in U.S. certification and doesn't expect Joby Aviation to secure full FAA Type Certification until at least the second half of 2026. Finally, Sheppard pointed out persistent uncertainty around the company's unit economics, such as pricing and deployment costs of its air taxi service. Is Joby Stock a Good Buy? Wall Street has a Moderate Buy consensus rating on Joby Aviation stock based on three Buys, three Holds, and one Sell recommendation. Furthermore, the average JOBY stock price target of $8.86 indicates that the stock is trading close to fair value.
Business Insider
an hour ago
- Business Insider
Trump urges EchoStar, FCC Chairman to resolve license dispute, Bloomberg says
President Donald Trump has intervened to urge EchoStar (SATS) and Federal Communications Commission Chairman Brendan Carr to resolve a dispute over the company's valuable spectrum licenses, Bloomberg's Kelcee Griffis and Stephanie Lai report. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>>
Yahoo
2 hours ago
- Yahoo
Column: Will Tesla suffer if Musk alienates both political wings?
Donald Trump and Elon Musk — two epic disrupters of U.S. politics and the automotive industry, respectively and vice versa. Over the past year, they united over the election and efforts to cut government spending. They parted ways amicably … and then started trashing each other. It escalated quickly with Musk suggesting that the president be impeached and that he is implicated in the Jeffrey Epstein child-prostitution scandal. Musk later reportedly called the president before posting that he regretted some of his words: 'They went too far.' It was a remarkable breakup — incredible drama between the world's most powerful man and the world's richest man, who had been the closest of allies for hundreds of days of campaigning and governing. To the extent that it was a reality TV train wreck, I'd just as soon leave it be. But since the primary business in Musk's remarkable portfolio is nominally an automaker, it actually matters in this industry we cover. Sign up for Automotive Views, Automotive News' weekly showcase of opinions, insights, ideas and thought leadership. Love it or hate it, this disruptive era in which we live is providing us all with some real-life experiments in economics — the likes of which we probably thought we would never see. For decades, basically everyone who went to college was taught in an economics or history class that widespread tariffs would do more harm than good. Trump argues for a different approach, and he's pursuing it. Or he's pursuing it to negotiate for something else. In either case, we're now seeing how that works: So far, there's been a lot of paralysis, especially among suppliers and foreign automakers, but also a big investment announced recently by General Motors. His political strategy has been unorthodox, yet he's won two electoral colleges and one popular vote. He's only the 21st president to win two elections. So he's had success, whether some people like it or not. Same for Musk, of course: He approached the auto industry unlike anyone else — with an expensive electric car — had a couple of near-total collapses, and came out as the world's richest man and CEO of the world's most valuable automaker. That success helped propel his rocket business SpaceX and other ventures such as Starlink satellites and Twitter, which he bought and renamed X. But the disruptive move I'm watching was his decision to be an automaker CEO who got personally and financially involved in partisan politics. While new-vehicle sales skew to the affluent, when you sell something in the millions or tens of millions, a brand or model has to connect with a broad swath of people. And while there can be success with, say, a polarizing design, mass-market brands generally try to avoid alienating large chunks of their potential customer base. I've cited here before the story about Michael Jordan saying he didn't speak out on politics because 'Republicans buy sneakers, too.' In retrospect, he said it was just a funny line among friends. But the thing is that he wasn't wrong, and every business school graduate knows it. Musk, however, is not your typical MBA type. So out of his frustration with former President Joe Biden — who habitually sided with the UAW and its automakers against the U.S.-based global leader in EVs, even as he advocated for a carbon-neutral future — Musk threw an estimated quarter of a billion dollars behind the Trump campaign. That's an unbelievable sum of money to many of us, but when Trump won, it looked like the greatest bet ever. From late October to late December, Tesla stock more than doubled and its market cap approached $1.5 trillion. While Musk's political activism may have upset many of his loyal, environmentally motivated customers, there were a lot of reasons to be bullish on Tesla under Trump. It seemed likely that NHTSA and the SEC would take a more sympathetic view of the company's issues. Beyond that, Musk has refocused the company's future on artificial intelligence, humanoid robots and robotaxis. (Tesla said it plans to launch its service in Austin, Texas, on June 22.) A new administration with a deregulatory inclination toward self-driving cars was a significant tailwind. Now, those advantages for Tesla are gone or at least seemingly diminished. Structures that have legacy automakers paying to buy Tesla's credits for selling emission-free, fuel-efficient vehicles could be eliminated. (And let's not forget that Trump hinted at ending federal contracts with other Musk-affiliated companies.) Turning back to the auto business: The conventional wisdom is that Musk has now alienated all but the most apolitical consumers. Environmentally minded liberals might like EVs, but Musk's support of Trump (and the far-right Alternative for Deutschland party in Germany) has them seeking out other brands' offerings. There might have been an opportunity to become the preferred electric brand of the president's Make America Great Again movement — especially the tech-forward, high-income types and those motivated by the president's endorsement of the brand on the White House grounds. But after this month's blowup — with longtime Trump adviser Steve Bannon arguing to deport Musk — that notion seemed ever more remote. No fans on the left, no fans on the right. Is Elon out in deep water in an electric boat surrounded by sharks with no friends to bail him out? Maybe not. There is significant animus against Musk on the EV-inclined left, especially in the wake of his DOGE team's deep and sometimes chaotic cuts to government entities and programs. Certainly, protests at auto retail outlets are rare. The damage to stores is not acceptable, but it shows the intensity of the situation. But I still have to wonder how far consumers will follow those kinds of feelings. Michiganders, for instance, often assume that Americans prefer to buy American cars made by American (union) workers. But I've been to America, and most of them don't care. They want the best car for their money, whether it's American, German, Japanese or Korean. Some are clamoring for cheap Chinese cars: If Xi Jinping wants to pay for half of their EV, they ask, why not let him? So maybe they won't care about Elon's politics. Tesla sales are down a little this year, but some of that might be attributable to production hiccups. If the Model Y — the bestselling model in the world last year — provides a great value, they'll probably buy it regardless of what they think of the CEO. And now we get to find out. Have an opinion about this story? Tell us about it and we may publish it in print. Click here to submit a letter to the editor. Sign in to access your portfolio
