American Attitude Toward Home Buying Dips

Perhaps a slowdown in home sales has cut confidence in home values, or perhaps a deceleration in rising home prices. Whatever the cause, new Gallup research shows the “home buying climate” dipping.

According to the firm’s researchers:

Americans remain positive about home buying, but are a bit less optimistic than they were in 2013 and 2014. Currently, 69% say it is a good time to buy a house, down from an average 74% during the prior two years, but similar to what Gallup measured from 2009-2012. Americans are more positive about buying a house now than they were between 2006 (when home values stopped rising and interest rates increased) and 2008 (after the housing bubble burst). In those years, just over half endorsed home buying.

Both 2013 and 2014 were periods marked by a recovery from the so-called housing bubble, and during that period prices rose throughout many large markets.

Case Shiller, which offers one of the most widely regarded measures of home values, reported as part of its most recent analysis trouble in some of the country’s largest markets. In January, the index posted a modest drop of 0.3% to 172.94. Research firm CoreLogic put the improvement for January to February up only 1.1%. Several large markets, which include Florida, Nevada and Rhode Island, still have prices more than 20% below the bubble peak.

Even with the drop Gallup measured, Americans remain guardedly optimistic about the future:

Even though Americans are a bit less positive about home buying in general, they expect home prices in their local areas to increase. Currently, 59% expect home prices to rise, 29% believe they will stay the same, and 11% expect prices to decrease. That is the highest percentage expecting an increase since 2006, when 60% did.

The 59% is dangerously close to when home prices reached historic highs.

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