Consumer confidence rose in September, reaching the highest level in 18 years.
According to the results of a survey conducted by the Conference Board, a global independent research organization, consumer confidence hit 138.4 in September, surpassing August’s level of 134.7. This is close to the all-time high of 144.7 in 2000, the Conference Board stated.
Economists at Reuters estimated consumer confidence level to reach 132 in September.
“Consumers’ assessment of current conditions remains extremely favorable, bolstered by a strong economy and robust job growth,” said Lynn Franco, director of economic indicators at the Conference Board. “These historically high confidence levels should continue to support healthy consumer spending, and should be welcome news for retailers as they begin gearing up for the holiday season.”
About the Survey
The Conference Board’s survey measures Americans’ sentiment on current economic conditions, business and labor market conditions, as well as their expectations for these components during the next six months.
According to the Conference Board, confidence for the short-term outlook improved significantly in September, with 27.6 percent of consumers expecting business conditions to improve over the next six months. This is higher than the 24.4 percent reached in August. The amount of consumers expecting business conditions to worsen fell to 8 percent in September from 9.9 percent in August.
Expectations for the labor market also made an improvement in September. According to the survey, 22.5 percent of respondents expected more jobs in the months ahead, up from 21.5 percent in August.
What This Means for Housing
Generally, higher consumer confidence can lead to increased consumer spending. That includes making large investments and purchases such as buying a home. Not surprisingly, the better people feel about their finances, the more confident they will likely be in taking on new debt. Therefore, September’s survey results may indicate an increase in mortgage application volume, existing-home sales, and possibly even new home construction.
Check back with our blog often to stay up-to-date on the latest developments in the mortgage and real estate industries. In the meantime, here are a few other posts you might enjoy: