The Fannie Mae Home Purchase Sentiment Index (HPSI) increased in March by 5.2 points to 81.7. Four of the HPSI’s six components increased month-over-month, including the components related to homebuying and homeselling conditions, household income, and home prices.

The mortgage rate outlook component experienced the only decline; and the latest results indicate that only 6 percent of consumers believe that mortgage rates will decrease over the next 12 months, according to the HPSI.

Year-over-year, the HPSI is up 0.9 points.

“The significant increase in the HPSI in March reflects consumer optimism toward the housing market and larger economy as vaccinations continue to roll out, a third round of stimulus checks was distributed, and the spring homebuying season began – perhaps with even more intensity this year, since 2020’s spring homebuying season was limited by virus-related lockdowns,” Fannie Mae Senior Vice President/Chief Economist Doug Duncan said in a release. “Homeselling sentiment experienced positive momentum across most consumer segments – nearly reaching pre-pandemic levels and generally indicative of a strong seller’s market.

“Consumers once again cited high home prices and tight inventory as primary reasons why it’s a good time to sell,” Duncan added. “Alternatively, while the net ‘good time to buy’ component increased month-over-month, it has not recovered to pre-pandemic levels, as the homebuying experience continues to prove difficult for many of the same reasons, namely high prices and a lack of supply.”

As far as a good or bad time to buy, the percentage of respondents who said it was a good time to buy a home increased from 48 percent to 53 percent, while the percentage who said it was a bad time to buy decreased from 43 percent to 40 percent. As a result, the net share of those who said it was a good time to buy increased 8 percentage points month-over-month.

With regards to a good or bad time to sell, the percentage of respondents who said it was a good time to sell a home increased from 55 percent to 61 percent, while the percentage who said it was a bad time to sell decreased from 35 percent to 28 percent. As a result, the net share of those who said it was a good time to sell increased 13 percentage points month-over-month.

On home price expectations, the percentage of respondents who said home prices will go up in the next 12 months increased from 47 percent to 50 percent, while the percentage who said home prices will go down decreased from 18 percent to 14 percent. The share who thought home prices will stay the same remained unchanged at 29 percent. As a result, the net share of Americans who said home prices will go up increased 7 percentage points month-over-month.

The HPSI also looked at mortgage rate expectations with the percentage of respondents who said mortgage rates will go down in the next 12 months decreased from 8 percent to 6 percent, while the percentage who expected mortgage rates to go up increased from 47 percent to 54 percent. The share who said mortgage rates will stay the same decreased from 38 percent to 34 percent. As a result, the net share of Americans who said mortgage rates will go down over the next 12 months decreased 9 percentage points month-over-month.

For job concerns, the percentage of respondents who said they are not concerned about losing their job in the next 12 months remained unchanged at 82 percent, while the percentage who said they are concerned also remained unchanged at 17 percent. As a result, the net share of Americans who said they are not concerned about losing their job remained unchanged month-over-month.

The percentage of respondents weighing in on household income who said their household income is significantly higher than it was 12 months ago increased from 17 percent to 25 percent, while the percentage who said their household income was significantly lower decreased from 19 percent to 15 percent. The percentage who said their household income is about the same decreased from 61 percent to 56 percent. As a result, the net share of those who said their household income is significantly higher than it was 12 months ago increased 12 percentage points month-over-month.