Americans Predict Rents and Home Prices to Increase

I just had a look at the latest National Housing Survey.Fannie Mae does a monthly survey covering different aspects of the housing market.
Here are some record numbers I found interesting in Fannie Mae’s March report, (emphasis added).

µ Thirty-three percent of respondents expect home prices to increase over the next 12 months, the highest level over the past 12 months.

µ The percentage of respondents who say it is a good time to buy rose to 73 percent, the highest level in over a year.

µ Forty-eight percent of respondents think that home rental prices will go up, the highest number recorded to date.

µ On average, respondents expect home rental prices to increase by 4.1 percent over the next 12 months, the highest number recorded to date.

Doug Duncan, chief economist of Fannie Mae, capped the report off by stating:

“Conditions are coming together to encourage people to want to buy homes. Americans’ rental price expectations for the next year continue to rise, reaching their record high level for our survey this month. With an increasing share of consumers expecting higher mortgage rates and home prices over the next 12 months, some may feel that renting is becoming more costly and that homeownership is a more compelling housing choice.”

This Spring Could Be The Best Home-Buying Season In Years

I found a great article from the Forbes website today written by Morgan Brennan, Forbes Staff.

This will be posted in multiple parts over the next few days, so you can absorb all of the information that is inside. Keep coming back for the whole picture...

The lion’s share of home sales typically come in the spring and early summer. April, May, June and July account for more than 40% of all housing transactions annually, in large part thanks to weather. Economists, realtors and Wall Streeters have been quick to surmise that 2012 will be the year of the market bottom, and with that prognosis circulating, it begs the question of what sellers and buyers can expect in housing as that high season nears.

“The spring home buying season looks bright because of an elevated level of contract offers so far this year,” Lawrence Yun, chief economist of NAR, said in a statement earlier this week. February home sales, despite a slight dip from January to February, remain well above 2011 numbers.

The Pending Home Sales Index, which reflects signed contracts that have yet to close, from the National Association of Realtors (NAR) was 9.2% higher than February of 2011 and existing-homes sales, or closed contracts, were 8.8% higher than last year.

That increased demand from buyers has pushed inventory levels 19% lower than they were this time last year, with an estimated 2.43 million homes available for sale. In fact, housing inventory is at a five-year low nationally right now. It means owners tinkering with the thought of selling have less competition to contend with, compared to the past five years. It also means housing may be inching toward a long-awaited recovery.

National Housing Survey 2012

The 2012 National Housing Survey from Fannie Mae is out and the KCM Crew brings us some of the highlights...

Each quarter, Fannie Mae releases their National Housing Survey. They survey the American public on a multitude of questions concerning today’s housing market. I like to pull out some of the findings I deem most interesting each time it is released. Here they are for the most recent report:

84% of the general population believes that owning a home makes more sense than renting.

The Most Important Reasons to Buy a Home

When we talk about homeownership today, it seems that the financial aspects always jump to the front of the discussion. However, the study shows that the four major reasons a person buys a home have nothing to do with money. The top four
reasons, in order, are:

1. It means having a good place to raise children and provide them with a good education.
2. You have a physical structure where you and your family feel safe.
3. It allows you to have more space for your family.
4. It gives you control of what you do with your living space (renovations and updates).

The Home as an Investment

Though most people purchase a home for non-financial reasons, everyone realizes
there is a money component to homeownership. Here is what they said on this issue:

63% of the general population believes that homeownership is a ‘safe’ investment.
53% believe that homeownership has more potential as an investment than any other traditional asset class.

Rent vs. Buy

I'm always interested in the difference people see in renting vs. owning.

64% of renters have aspirations to someday own their own home.
70% of renters think that owning is superior to renting.


Bottom Line

My belief in the value of homeownership grows each time this survey is released