Americans are bracing for houses to get costlier.
In a recent survey, 64 percent said they’re anticipating an increase in property values during the next year, according to findings from Gallup. (Click on graphic to enlarge.)
That’s the highest share since the housing bubble in the mid-2000s, when 70 percent were predicting price levels to soar.
Optimism levels vary depending on which pocket of the country you find yourself. Nearly 80 percent of Americans in the West forecast a pricier real estate market in the next year, compared with 64 percent in the South, 58 percent in the East and 56 percent in the Midwest.
The biggest takeaway? “People are very positive about the housing market,” said Frank Newport, editor-in-chief at Gallup.
Despite rising prices, Americans want in.
To that point, 45 percent of non-homeowners say they plan to buy a house in the next five years. However, just 22 percent of homeowners in that same time period anticipate selling. Such an imbalance between supply and demand could explain in part why property values are on the rise, Newport said.
Of course, while rising home prices are great if you’re a homeowner looking to sell, that trend isn’t fabulous if you’re in the market. Accumulating enough for a down payment becomes that much more of a stretch.
For example, the growth of student loan debt already poses a major barrier to homeownership for many Americans. More than 80 percent of people ages 22 to 35 with student debt who haven’t bought a house yet blame their educational loans, according to the National Association of Realtors.
Regardless, two-thirds of Americans still believe right now is a good time to buy a house, Gallup found.
“The more cynical investor swoops in and buys when prices are at the bottom,” Newport said. “But Americans are not cynical investors.”
Gallup conducted telephone interviews between April 2 and 11, with a random sample of 1,015 adults age 18 and older. The results have a margin of error of plus or minus 4 percentage points.
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