Social Trends: As Home Prices Cool Down, Homeowners Temper Their Optimism

Source Organization: Pew Research Center

12/06/2006 - Despite a record drop this past year in the median sales price of existing homes, more than eight-in-ten homeowners expect the value of their homes to go up either "a little" (55%) or "a lot" (26%) in the future. However, these anticipated levels of future gains are not nearly as great as the gains that homeowners say they've experienced in recent years.

About twice as many homeowners (46%) say their house increased "a lot" in value over the past few years as say they expect similar increases in the future, according to a nationwide Pew Research Center telephone survey of a random sample of 2,000 adults, including 1,500 homeowners, taken from October 18 through November 9, 2006.

Meantime, just 10% say they expect the value of their houses to decline.

This moderated optimism among homeowners comes at a time when there has been a flurry of reports about a housing slump. Last week the National Association of Realtors (NAR) reported that the median price of an existing home sold in October of this year was $221,000, down a record 3.5% from October of 2005.1 It was the third straight month that the industry group recorded a year-to-year decline. Prior to this August, the NAR had not reported such an annual decline since 1995.2

Read the full report As Home Prices Cool Down, Homeowners Temper Their Optimism on the Pew Research Center Web site.

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