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On Monday, the Federal Reserve Bank of New York’s Center for Microeconomic Data released the August 2018 Survey of Consumer Expectations. According to the Survey, home price growth expectations fell for the second month in a row, while income and spending growth expectations remained relatively stable, and household financial situations expectations improved.
The survey found that consumers expect home prices to increase by a median of 3.6 percent as of August, compared to 3.7 percent in July and 3.9 percent in June. However, this is still higher than the 3.4 percent 12-month average.
By age, the oldest consumers expect the biggest changes in home prices. Consumers over 60 expect home prices to increase by 4.22 percent, compared to 3.17 percent for consumers aged 40 to 60, and 3.26 percent for those under 40.
While consumers have lowered their expectations about home price appreciation, their expectation for median inflation remained relatively flat and unchanged at 3 percent. Additionally, gasoline prices are expected to increase by 4.4 percent, down from 4.6 percent in July.
According to the New York Fed’s survey, mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—jumped from 34.2 percent in July to 35.3 percent in August, reaching its highest level since October 2017. However, this doesn't mean everyone thinks they’re going to lose their jobs. The survey found that mean perceived probability of losing one’s job in the next 12 months and the mean probability of leaving one’s job voluntarily in the next 12 months declined, from 14.0 percent to 13.8 percent and from 23.2 percent to 20.6 percent, respectively.
Speaking of jobs, the survey also found that respondents are slightly more pessimistic about the chances of finding a job if they lose theirs. According to the Fed, the mean perceived probability of finding a job declined to 57.8 percent in August, falling below its 12-month trailing average of 59.0 percent, but remaining within its tight 57.1 to 60.1 range observed since July of 2017.
Find the full report form the New York Fed here.
