How Do Americans Feel About The Housing Market?

As a trusted provider of home mortgage financing at Gulfside Mortgage Services, we understand that the housing market is a significant concern for many Americans.

Recent surveys and studies have shed light on the public sentiment toward the current state of the housing market, and honestly, public opinion still reflects a bleak outlook. For many of you, this may discourage you from taking that next step toward purchasing a home.

And we get it – we understand that many of you simply want to know: is now a good time to buy a house? And with all the bad feelings out there currently, it can make it seem scary to take the next step.

But is this an accurate way to make your decision? To know the real answer behind whether is now a good time to buy a house or not, it’s important to not just consider how Americans feel about the housing market.

You also must consider what statistics and data have to show about the market, and you also have to consider your own unique situation.

Unfortunately, much of the current public opinion is influenced by those who remember the housing crash of 2008. But, as we have mentioned before, the housing market now is not the same as it was in the early 2000s, and so we would make the case that people should not be anticipating the same thing to happen now.

So, let’s delve a bit into the details. Let’s look at the current public opinion, the influences behind it, and what the reality of the data means for you and/or your real estate clients.

Perception of Risk

A recent report revealed that 44% of Americans believe the housing market is at risk of crashing within the next year. This sentiment is echoed by 36% of homeowners and 35% of Americans overall who actually want the market to crash, believing that a crash is the only way they will be able to afford a home.

This might seem alarming, but it’s important to understand the reasons behind these sentiments.

Anticipating a Repeat of the Early 2000s Crash

As stated above, when we are talking about public opinion, it is heavily influenced by what happened 15 years ago with the 2008 housing crash. Many potential home buyers feel that the significant and quick home price increases we have seen since 2020 are similar to 20 years ago, and so are convinced that a crash is inevitable as well.

However, what many who lived through that don’t recognize is that the current cause for increased housing prices, as well as the handling of home loans, is not at all the same as it was then.

In the early 2000s, loans were being given out with much less regard for the ability of repayment. There was, admittedly, a great deal of irresponsible lending.

However, because of that crash, lending laws changed significantly. Lending has been much more responsible, and so most who have gotten into a mortgage are still capable of affording that mortgage.

Furthermore, while housing prices did fall in 2008, that was truly an unprecedented occurrence. Historically speaking, including in previous times of inflation and economic struggles similar to what we have today, housing prices usually hold steady and even continue to increase, even if it is slowly.

So, if you want history to be your predictor, there are far more examples that would predict housing prices to hold and continue increasing, rather than predicting a drop and crash.

Affordable Housing Concerns

Perhaps just as influential or more than the above, however – one of the main reasons for the current pessimistic outlook is the perceived lack of affordable housing.

A Pew Research Center report highlighted that 49% of Americans consider the availability of affordable housing a major problem. This sentiment is particularly strong among non-homeowners, with 32% believing a market crash is their only way to own a home.

So, as odd as it may sound, for many potential homeowners, a housing market crash is actually wishful thinking.

But wishful thinking is not reliable or predictive data.

Economic Factors

However, there is of course some hard-core data that contributes to current pessimism about the housing market.

Economic factors such as ever-rising mortgage rates, continued inflation, and a worsening economy are also contributing to the negative sentiments.

About 53% of Americans are worried that mortgage rates will remain high, and 79% expect rates to rise for at least another year.

Thus, many potential buyers are waiting till they feel like they can see the light at the end of the tunnel in the form of decreasing mortgage rates.

The Silver Lining

Despite the concerns, there’s a silver lining.

Many Americans still see homeownership as a worthwhile investment, as indeed it is.

Furthermore, about 62% of Americans think home prices will increase in the next year, with two-thirds believing they’ll rise by 5% or more.

Furthermore, as stated above, the historical data indicates that we can anticipate that housing prices will indeed continue to increase rather than fall.

While this may seem discouraging, particularly to those struggling to purchase their first home, it means that the housing market is stable.

It means that working hard for that investment will pay off – a home purchased today will continue to appreciate and grow equity after purchase – its value will not plummet, leaving the buyer “upside down” in the house. Rather, it will be a true investment, increasing the owner’s net worth.

So What Does It All Mean?

What does that mean for you or your clients?

It means that, as much as we may not like current interest rates or inflation, now is the time to buy a home if at all possible.

Home prices will only keep going up – but we can anticipate that interest rates will eventually come down, at which time a homeowner can refinance if need be. A house that is within reach today may not be next year, so waiting may be riskier than buying now.

At Gulfside Mortgage Services, we’re committed to helping our clients navigate these challenges. We provide the lowest rate home mortgage financing by accessing wholesale rates and passing the savings on to you.

Our team of experienced professionals is ready to guide you through the process, providing personalized service to meet your unique needs.

Remember, every housing market has its ups and downs. Staying informed and making decisions based on your unique circumstances and long-term goals is essential.

If you have any questions or need assistance, don’t hesitate to reach out to us at Gulfside Mortgage Services.