The infectious optimism surrounding the housing market has the majority of Americans feeling more positive, according to survey results from Gallup.
As part of its “New American Consumer” series investigating housing and homeownership, Gallup polled more than 2,000 Americans and 1,400 homeowners for their thoughts on home prices and the state of the market. Other data included in the series measured reasons forrenting vs. buying and current and projected homeownership.
According to Gallup’s findings, 51 percent of those surveyed said they expect home prices to rise in their area over the next year—the first time since 2007 that that number has been above 50 percent. Last year, only 33 percent of respondents gave the same answer.
In this year’s survey, 34 percent of Americans said prices will stay the same—down from 44 percent last year—while 14 percent said prices will fall, down from 23 percent.
“Americans’ views of the housing market became understandably more pessimistic during the housing crisis and its aftermath. But with the housing market picking up again, so has Americans’ optimism about home prices,” explained Gallup analyst Jeffrey M. Jones.
Western residents are the most optimistic about home values, with 62 percent expecting prices to increase. Next is the East, with 49 percent anticipating price gains, followed by the South (48 percent) and the Midwest (44 percent).
Furthermore, more homeowners are seeing the benefits of rising prices. In Gallup’s 2012 survey, only 53 percent of U.S. homeowners said their house was worth more than they paid for it, down from more than 90 percent in 2006. In the most recent survey, 63 percent now say their house is worth more than what they paid, providing evidence of a recovery in home values.
At the same time, Americans continue to see the market as favorable for purchasing. In this year’s survey, 73 percent of respondents said now is a good time to buy a house, the highest share since 2003 (when 81 percent gave the same answer). Jones noted that even during the depths of the housing crisis, that percentage never fell below 50 percent, indicating consumers look at various factors when gauging the strength of the market.
“For example, when prices dropped, Americans may still have believed it was a good time to buy a home because lower home prices provided a favorable buying opportunity,” Jones said. “Also, regardless of market conditions, Americans may generally just believe buying a home is a good thing to do.”