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M R EP O RT | 15 MDWELL DECEMBER 202 Buying Conditions Good Time: 26% Bad Time: 66% Net Good Time to Buy: -40% Selling Conditions Good Time: 76% Bad Time: 17% Net Good Time to Sell: 59% Home Price Outlook (Next 12 Months) Go Up: 44% Go Down: 19% Net Go Up: 25% Mortgage Rate Outlook (Next 12 Months) Go Down: 4% Go Up: 56% Net Go Down: -52% Job Loss Concern (Next 12 Months) Not Concerned: 82% Concerned: 16% Net Not Concerned: 66% Change in Household Income (Past 12 Months) Significantly Higher: 23% Significantly Lower: 17% Net Significantly Higher: 6% Fannie Mae on How Homebuyer Sentiment Is Shifting According to a new survey by Fannie Mae, more consumers believe mortgage rates will tick up this year, possibly indicating a market slowdown. F annie Mae's latest iteration of the monthly Home Purchase Sentiment Index (HPSI) fell by a slight 0.5 points to 74.2 in Decem- ber as consumers wildly differed on whether it is a good time to buy or sell a home and their outlook on the economy. When combined, these metrics may indicate a slowing of the real estate market as we move into 2022. Overall, three of the six indicators used in the report dropped last month. Among the 1,003 heads of households surveyed, 76% responded that now is a good time to sell a home but only 26% of respondents indicated that now is a good time to buy—a record low seen by the survey. "The HPSI's underlying components changed dramatically in the last 12 months— particularly the two related to homebuying and home-selling sentiment—and we have seen the index drift slightly downward since March 2021, an indication that the housing market may begin to soften in the coming year," said Doug Duncan, Fannie Mae SVP and Chief Economist. "Over the past year, low mortgage rates plus government stimulus programs helped increase mortgage demand, but the bidding-up of homes increased prices to record levels, making affordability a greater constraint for both first-time and move-up homebuyers. Among homeowners, the 'good time to buy' sentiment fell 30 percentage points over the past year to its current level of 30%; for renters it fell from 37% to 21%. Even though demand remains strong, a majority of consum- ers clearly have reservations about purchasing a home at current prices." Source: Fannie Mae Home Purchase Sentinment Index, January 7, 2022

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