This time the prism on the economy is the housing market, and the surveyor is housing lender Fannie Mae. It looks at consumer sentiment on a monthly basis, and finds for most, income hasn’t improved over the past year, nor is it expected to improve any time soon.
The number that is based on the actual personal histories of the respondents is a telling statistic indeed: 65% of those surveyed say their income hasn’t moved in the past 12 months – Fannie Mae says that is the highest result it has ever recorded.
It hit another all time high when it asked about the next 12 months. 46% expect more of the same – no change in income. 77% also believe that the economy is headed in the wrong direction.
A stagnant income isn’t acceptable for 36% who say that their expenses are significantly higher than they were a year ago. However, there has been some positive movement in that regard – the number was 43% during the September survey.
“The October survey showed that consumers’ outlook for the housing market has remained downbeat, as they expect home prices to decline over the next year, extending the streak of negative outlooks to five consecutive months,” said Doug Duncan, vice president and chief economist of Fannie Mae. “More positive economic headlines over the past month failed to lift consumers’ moods. While their views regarding their personal finances and the direction of the economy have not deteriorated further, it is discouraging to see the lack of appreciable improvement after overall sentiment took a hit during the debt ceiling debate in August.”
“The fact that sentiment appears to be in a holding pattern at depressed levels is a cause for concern for the development of the housing market and for the economy as a whole, as there will be no meaningful economic recovery without a housing recovery,” Duncan stated.