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More Americans think it's not a good time to buy a home, here's why

Megan Henney

The number of Americans who think it’s a bad idea to buy a home right now rose in October, according to a monthly sentiment survey released Thursday by mortgage giant Fannie Mae.

Only 21 percent of Americans said it was a good time to purchase a home, which was down from 28 percent from September. The percentage of people who think it’s a good time to sell a home also dropped, from 44 percent to 41 percent.

Plummeting mortgage rates caused buyers to rush in to snap up property earlier this year. That led to a shortage of affordable housing, which caused a spike in prices.

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“The ‘good time to buy’ component has declined notably, despite low mortgage rates, due in part to the persistent challenge of a lack of affordable housing supply,” Doug Duncan, Fannie Mae’s senior vice president and chief economist, said in a statement.

Even though only 27 percent of consumers — the lowest amount in seven years — expect home prices to increase next year, housing data says otherwise. According to the National Association of Realtors median sales price climbed 5.9 percent from last year to $272,100, the 91st straight month of year-over-year gains.

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“Home prices are rising too rapidly because of the housing shortage, and this lack of inventory is preventing home sales growth potential,” Lawrence Yun, NAR’s chief economist, said in a statement.

The 30-year fixed mortgage rate has dropped 1.16 percent from the year-ago period to an average of 3.69 percent, according to mortgage finance agency Freddie Mac.

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