Americans had more positive opinions about the housing market in May, due largely to the increased feeling that it is a good time to buy a home, according to the latest National Housing Survey by Fannie Mae. Buying a home looked more attractive as respondents were increasingly likely to expect stable mortgage rates, an easier mortgage process, and steeper rent hikes.

Fannie Mae's Home Purchase Sentiment Index for the month increased 3.7 points to 92, falling just short of the survey high of 92.3 set in May 2018. The index is based on six factors from the survey, including whether respondents consider it a good or bad time to buy or sell a home, anticipated changes to home prices and mortgage rates, changes in household income, and job security.

"While consumers' more favorable mortgage rate outlook suggests continued support for housing affordability, potential homebuyers still face supply restraints," said Doug Duncan, senior vice president and chief economist at Fannie Mae. "Additionally, while the survey recently resumed its upward trend, consumers' sense of income growth and job security have moved lower from the highs established earlier in the year, which, if sustained, could weigh on the housing market in the second half of the year."

Six out of 10 respondents said they believe it is a good time to buy a home. This was up from 53 percent in April and 59 percent in May 2018. One-third of respondents thought it was a bad time to buy, down 6 percentage points from the previous month but a year-over-year increase of 2 percentage points.

Fifty-nine percent said they think it would be easy to get a mortgage, up 4 percentage points from April and 3 percentage points from May 2018. Thirty-eight percent though it would be difficult to get a mortgage, down 4 percentage points from the previous month and 3 percentage points from the previous year.

Forty-three percent said they think mortgage rates will go down in the next 12 months, falling 17 percentage points from a high of 60 percent in November. This was also down 3 percentage points from the previous month and 11 percentage points from the previous year. The share expecting mortgage rates to go down has held steady at 6 percent for three months.

Sixty-five percent said they expect home rental prices to increase in the next 12 months, up from 61 percent in both the previous month and previous year. Three percent said they think rental prices will drop in the coming year, down from 2 percent in both April and May 2018. On average, respondents expected rental prices to increase by 5.4 percent over the next 12 months – up from an expected 4.6 percent annual increase in both the previous month and previous year.

Despite these expectations and the positive attitude toward buying, more respondents said they would likely rent their next home if they were to move. Thirty-one percent said they would do so, up 2 percentage points from both April and May 2018. The share saying they would buy fell from 69 percent in March and 67 percent in April to 65 percent – a year-over-year drop of 2 percentage points.

Attitudes toward selling held steady, with two-thirds of respondents considering it a good time to sell a home – down 1 percentage point from the previous month and previous year. Twenty-three percent thought it was a bad time to sell a home, down 1 percentage point from April but up 2 percentage points from May 2018.

Half of all respondents said they think home prices will go up in the next 12 months, up 5 percentage points from the previous month but down 5 percentage points from the previous year. Nine percent said they think prices will go down, unchanged from April and a year-over-year increase of 3 percentage points. On average, respondents expected home prices to grow by 3.1 percent over the next 12 months – up from expected growth of 2.4 percent in the previous month but down from an average expectation of 3.5 percent in the previous year.

Eighty-eight percent said they aren't concerned about losing their job in the next 12 months, up 1 percentage point from April but down 1 percentage point from May 2018. Twelve percent said they are worried about potentially losing their job, down 1 percentage point from the previous month but up 1 percentage point from the previous year.

Thirty-one percent said their household income is significantly higher than it was a year ago, down 1 percentage point from April but up 1 percentage point from May 2018. Ten percent said their income was significantly lower, unchanged from the previous month but up 1 percentage point from May 2018.

Half of all respondents said they believe their personal financial situation will improve in the next 12 months, up 2 percentage points from the previous year but down 1 percentage point from the previous month. Eleven percent said they think their financial situation will worsen, up 3 percentage points from April and 1 percentage point from May 2018.

Attitudes toward the U.S. economy have improved in recent months, with the share considering the economy to be on the right track rising from 51 percent in March and 52 percent in April to 53 percent – matching a recent high in November and a year-over-year gain of 3 percentage points. Thirty-four percent said they thought the economy is on the wrong track, down 2 percentage points from both the previous month and previous year.

Fannie Mae's National Housing Survey collects responses from approximately 1,000 American adults each month. Respondents are interviewed via telephone and asked more than 100 questions on the housing market and economy to track attitudinal shifts on a variety of topics.