Fannie Mae Report Indicates Rise In Consumer Pessimism

Seventy percent of Americans think the economy is heading in the wrong direction - versus 23 percent who think it’s improving, according to July consumer indicators released August 8 by Fannie Mae.

An increasing number of consumers don’t think home prices and personal finances will improve. Just 11 percent of the survey’s 1,000 respondents think it’s a good time to have a home on the market, and the number of people who said they will buy their next home dropped 5 percentage points while those who say they will rent their next home increased by 3 percentage points.

“Our overall July survey data, beyond the eleven indicators we present this month, show that most Americans think the economy is on the wrong track – the highest level of pessimism to date for this topic,” Doug Duncan, Fannie Mae vice president and chief economist, said in a press release.

Down from 40 percent in April, just 35 percent of the respondents think their finances will get better over the next year, and 40 percent of respondents reported significantly higher household expenses - up from 37 percent in June. “The impact of recent financial market volatility on household wealth has been a setback to consumer confidence,” Duncan noted.