Originally published on January 24, 2017 by ValueInsured.
Americans are starting off 2017 feeling cautiously optimistic about the housing market, reports the latest ValueInsured Modern Homebuyer Survey. The first consumer confidence survey conducted in January and released post-inauguration reveals nearly seven-in-10 Americans (69 percent) believe 2017 will be a better year for the housing market than 2016, despite rising interest rates and a new administration.
The optimism is anchored by Millennial non-homeowners who recorded the highest confidence increase over the last quarter, up 5.0 points with a score of 61.3 in the ValueInsured Housing Confidence Index, which reflects seven housing confidence measures from the survey. This rising confidence among millennial non-homeowners, align with recent reports such as NAR, which suggest that the 2017 housing market could be driven by eager first-time homebuyers. Renters who want to buy report to be more confident in their ability to afford a home: 41 percent of millennials non-homeowners now believe 2017 will be an easier year to buy a home. Forty-four percent are also now confident they can afford a home down payment, up 6 percent points from September.
With home prices predicted to stabilize, additional findings from ValueInsured’s quarterly Modern Homebuyer Survey also report rising confidence:
- 58 percent of Americans and 62 percent of millennials believe the housing market will become more favorable for them in 2017.
- 52 percent of Americans and 59 percent of millennials believe the housing market will become more favorable with this new White House.
- 74 percent of homeowners believe 2017 will be easier for them to upgrade to a new home.
The numbers do hold a note of caution. While the January Index as a whole still registered a housing confidence measure of 68.0, it dipped by 0.9 point on a 100-point scale since September. While slight, this is the first slide since March 2016 and is consistent with other popular housing confidence measures that reported the same directional movement, including Fannie Mae's Home Purchase Sentiment Index. This drop was primarily driven by homeowners.
Homeowners are less confident now than they were in September that their homes are worth what they paid for them (down 7 percentage points), and they are less confident that home prices in their area will continue to go up (down 9 percentage points).
Nonetheless, approximately four-in-five Americans continue to think buying is better than renting (78 percent) and owning is an important part of their American Dream (79 percent).
“I recommend Americans, especially first-time buyers, absolutely pursue their dream of owning a home,” said Joe Melendez, CEO of ValueInsured. “But it’s up to us as an industry to help make them feel more confident in doing so, and that starts with us giving them greater certainty by protecting their down payments.”
For additional findings from the latest ValueInsured Modern Homebuyer Survey visit: valueinsured.com/trends.