Americans remain convinced that buying a home is a good long-term investment. That's just one of the findings from the 2007 National Housing Pulse Survey, which is annually conducted by the National Association of REALTORS® Housing Opportunity Program.
This year's results show that nearly nine out of 10 consumers believe buying a home is a good financial decision. Fifty-nine percent of respondents also agree that now is a good time to buy a home; that number is even higher (64 percent) in areas of recent home price declines.
The survey shows Americans are more concerned about obtaining a mortgage and having enough money for down payment and closing costs than they have been in five years of polling. Nearly six in 10 respondents believe it's difficult for people in their area to obtain a fair and affordable mortgage. More than eight in 10 say having enough money for down payment and closing costs are obstacles for home buyers in their area, up 17 percent from 2005. Sixty-three percent also think the mortgage approval process is an obstacle, up 13 percent since 2005.
Of those surveyed, more than one in five homeowners have some type of variable-rate mortgage, including interest-only (15 percent), adjustable-rate (6 percent) and a balloon or other large payment due in the next five years (2 percent).
These homeowners feel more strain from their monthly mortgage payment than those with fixed rates. In fact, more than half of those with variable-rate mortgages say they feel a significant or slight strain, whereas fifty-three percent of those with fixed-rate mortgages feel little or no strain at all. Despite these findings, only five percent of respondents say they are very or fairly worried about being able to make their mortgage payments over the next year.
The survey shows Americans are split on the need for more federal government oversight. Forty-seven percent believe the federal government should take a more active role, while 45 percent believe oversight is the private sector's responsibility.
While 32 percent of those surveyed perceived the rate of home foreclosures in their area to have increased over the past year, 39 percent report the rate has remained about the same; 6 percent believe the foreclosure rate has decreased in their area. When asked how big of a problem foreclosures were in their area, 38 percent of respondents said foreclosures were a very big or moderate problem, but the majority, 51 percent, said foreclosures were only a slight problem or not one at all.
"Owning a home continues to be a good, long-term investment, and most consumers understand that," said Silicon Valley Association of REALTORS® President Mark Burns. "This new survey clearly shows that people still believe in the value of homeownership. They buy because the home satisfies their needs for shelter, schools, commute and a neighborhood. I would treat a home as an investment last and consider it the place where the family gathers, the kids go to school, you have neighbors that become lifelong friends and you are not too far from work, as somewhere you can come home to and know it is yours."
The 2007 National Housing Pulse Survey was conducted among 1,000 adults living in the United States in October 2007. The study has a margin of error of plus or minus 3.1 percentage points.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please email or call the SILVAR office at (408) 200-0100.