April 24 (UPI) — More than three-fifths of U.S. adults predict housing prices in their area will rise in the next 12 months, according to a Gallup poll.
Americans are the most optimistic about housing prices since the percentage was 70 percent in 2005 — the first year Gallup asked the question
Sixty-one percent now believe prices will rise — 6 percentage points above last year’s poll.
In the poll, 28 percent of the respondents predict prices will stay the same and 10 percent believe they will decrease.
The sentiment has increased since the housing bust and recession. In 2009, 22 percent said prices would rise. It wasn’t until 2013 when a majority held the positive review — 51 percent.
These expectations largely reflected what has happened to U.S. home values over the past 10 years.
“The continued increase in housing prices leads to questions of whether another housing bubble could occur,” Gallup’s Jeffrey M. Jones said in a release. “While prices now are nearly where they were a decade ago, houses are more affordable because of lower interest rates, and banks are more reluctant to issue risky mortgages than they were before the mid-2000s housing market crash. Still, if housing prices continue to rise and interest rates increase, the potential for a new housing bubble will grow.”
Home prices expectations vary by region. In the West, 74 percent said prices will rise compared with 61 percent in the South, 54 percent in the East and 53 percent in the Midwest.
Americans also believe market conditions are strong to buy a house.
Sixty-seven percent say it’s a good time and 30 percent say it is a bad time. From 2012-14, the positive sentiment was 74 percent compared with 24 percent negative.
More homeowners (74 percents) than renters (56 percent) say it is a good time to buy a house.
Fewer people now buy homes. From 2004 through 2007, an average of 72 percent of U.S. adults reported owning a house. And since 2015, the average is 61 percent.
In another Gallup poll released last week, 34 percent of the respondents said real estate was the best way to earn a return on a long-term investment compared with 26 percent in the stock market or mutual funds, 18 percent in gold, 12 percent a standard savings account or CD and 5 percent bonds.
In both surveys, Gallup interviewed a random sample of 1,019 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia from April 5-9. The margin of error is 4 percentage points.
