It appears rising interest rates pushed consumers over the edge when it comes to whether it is a good time to buy a home. According to Fannie Mae, the Home Purchase Sentiment Index® (HPSI) decreased by 4.7 points to 68.5 in April, its lowest level since May 2020, as surveyed consumers expressed heightened concerns about housing affordability and rising mortgage rates.

All six of the index’s components decreased month over month, with a survey-high 76% of consumers indicating that they believe it’s a bad time to buy a home, up from 73% last month.

In April, the HPSI fell to its lowest level since the first few months of the pandemic, as consumers continue to report difficult homebuying conditions amid the budget-tightening constraints of inflation, higher mortgage rates and high home price appreciation,” said Doug Duncan, Fannie Mae’s senior vice president and chief economist.

As one could expect in this competitive market, entry-level homebuyer’s sentiment toward purchasing right now took an even bigger hit. According to Fannie Mae, an even larger share of younger respondents (ages 18 to 34) reported that it’s a “bad time to buy a home.”

“The current lack of entry-level supply and the rapid uptick in mortgage rates appear to be adversely impacting potential first-time homebuyers in particular,” said Duncan. “The benefit of the recent past’s historically low mortgage rate environment appears to have diminished, and affordability is poised to become an even greater constraint going forward. This sentiment is consistent with our forecast of decelerating home sales through the rest of 2022 and into 2023.”

Year over year, the full HPSI is down 10.5 points from 79 in April 2021 to 68.5 in April 2022.