PRINCETON, NJ -- Americans continue to see a buyer's market in housing. Sixty-nine percent say now is a good time to buy a house -- essentially unchanged since 2009.
Many Americans also thought it was a good time to buy between 2003 and 2005, when housing prices were increasing and getting financing was relatively easy. Those attitudes began to change in 2006 as some homebuyers began to realize a housing bubble was taking shape in local markets across the country.
Those in the West and Upper-Income Americans Most Likely to Say Now Is a Good Time to Buy
Men are more likely to see now as a good time to buy than are women. Those living in the West are also more likely to hold this view than those in the South. Americans making $75,000 or more a year are more likely to see 2011 as a good time to buy than are those making less than $75,000.
About as Many Americans Expect Home Prices to Increase as Decrease
Americans' expectations for home prices in their local markets are slightly better now than they were in January; currently, just as many Americans say home prices will increase as say they will decrease over the next year. This is also better than the situation in 2008 and 2009, but a far cry from housing price expectations in prior years, when the majority expected prices to rise.
Essentially the same percentage of Americans expect house prices to increase as to decrease across most demographic groups, with the exception of the Midwest, where more feel home prices will decrease than increase.
Implications
There appears to be good reason for more than two in three Americans to think now is a good time to buy a house. Home prices have plunged in many markets across the country in recent years. The combination of today's low mortgage rates and low housing prices make affordability as good as it has been for a long time.
Of course, a big part of the problem for housing is that mortgage finance is dominated by the federal government in the form of Fannie Mae, Freddie Mac, and Ginnie Mae. Mortgage loans are hard to get for anyone who doesn't have nearly perfect credit and fit the current government loan profile. Prospective homebuyers who buy a home now in one of many local markets face the risk that it could decrease in value in the short term; indeed, 3 in 10 Americans believe housing prices will go down in their communities over the next year.
Further, today's high unemployment rates and plunging consumer optimism are not encouraging for the potential homebuyer. As a result, even though it is a good time to buy, many Americans do not feel secure enough with home prices or the economy to do so, and among those who do feel secure enough, even fewer can get the mortgage financing they need.
Many economists seem to hope that housing will stabilize and no longer be a negative influence on the U.S. economy. An improving housing market is essential both socially and economically. Homeownership is a key element in creating strong local communities as well as a strong U.S. middle class. Housing is also an important sector in the U.S. economy that not only serves a vital need and provides jobs, but also creates demand for all kinds of products and services tangentially. The U.S. economy will have trouble recovering fully from the recession without a growing housing market.
Survey Methods
Results for this Gallup poll are based on telephone interviews conducted April 7-11, 2011, with a random sample of 1,077 adults, aged 18 and older, living in the continental U.S., selected using random-digit-dial sampling.
For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±4 percentage points.
Interviews are conducted with respondents on landline telephones and cellular phones, with interviews conducted in Spanish for respondents who are primarily Spanish-speaking. Each sample includes a minimum quota of 400 cell phone respondents and 600 landline respondents per 1,000 national adults, with additional minimum quotas among landline respondents for gender within region. Landline telephone numbers are chosen at random among listed telephone numbers. Cell phones numbers are selected using random digit dial methods. Landline respondents are chosen at random within each household on the basis of which member had the most recent birthday.
Samples are weighted by gender, age, race, Hispanic ethnicity, education, region, adults in the household, and phone status (cell phone-only/landline only/both, cell phone mostly, and having an unlisted landline number). Demographic weighting targets are based on the March 2010 Current Population Survey figures for the aged 18 and older non-institutionalized population living in U.S. telephone households. All reported margins of sampling error include the computed design effects for weighting and sample design.
In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.
For more details on Gallup's polling methodology, visit www.gallup.com.
