SEATTLE, Sept. 1, 2016 /PRNewswire/ -- Homeowners are
feeling increasingly confident that now is a good time to sell a
home, but renters are feeling uncertain they'll be able to afford
to buy, according to the latest Zillow® Housing Confidence Index
(ZHCI)i.
Existing homeowners have a more positive attitude toward selling
than buying, an imbalance that is causing a slowdown in many
markets, especially in the more expensive, urban cores. Less than
65 percent of homeowners surveyed said now is a good time to buy, a
number that's been declining for the past two years.
Just 38 percent of renters surveyed said now is a good time to
buy a home and about 50 percent of renters in San Francisco and New York expressed a lack of confidence in
their ability to afford a home in the future. Almost half of the
renters surveyed in Seattle,
San Jose and Boston had similar feelings.
Meanwhile, confidence among homeowners is on the rise, with the
most confident homeowners concentrated in Western and Southwestern
cities. Out of every 10 homeowners surveyed, seven said now is a
good time to sell a home.
Home values are at or past peak levels in roughly a quarter of
U.S. markets, signaling a recovery since the housing bubble bust,
but a growing divide between renter and homeowner sentiments
persists, highlighting two very different trends in the housing
market right now.
"The overall health of the housing market looks great at first
glance, but dig a bit deeper you'll find inequality between renters
and homeowners," said Zillow Chief Economist Dr. Svenja Gudell. "Even though the majority of
homeowners are confident and believe now is a good time to sell,
they're holding off because they expect home values to continue to
appreciate and want to ride the wave. They also don't want to turn
around and become buyers in a competitive market. On the flip side,
renters aren't nearly as confident as homeowners -- they're
discouraged by the shrinking number of homes for sale and rapidly
rising prices. As housing gets more and more expensive, these
trends are not sustainable in the long-run, especially once
mortgage rates start to rise."
The semi-annual U.S. Housing Confidence Survey (HCS), sponsored
by Zillow and conducted by Pulsenomics LLC, asks 10,000 renters and
homeowners about the condition of their local real estate market,
their expectations for home value growth and affordability in the
future, and their views on homeownership.
Housing confidence among homeowners continues to exceed that of
renters in each of the metro areas surveyed. This gap is smallest
in Miami and largest in
Seattle, which has the highest
year-over-year rent appreciation of the 35 largest U.S. metros and
rapidly rising home values, up 11 percent over the past year.
"During the past two years, housing confidence has increased in
all but two of the metro areas that we study," said Terry Loebs, the founder of Pulsenomics LLC.
"Rising home equity levels, healthy housing market expectations
among millennials, and resilient homeownership aspirations among
minority groups have all been factors in the robust readings of
overall U.S. housing confidence. However, within certain metro
areas and market segments, key sentiment indicators have begun to
fade. Our measure of housing market expectations among residents of
the largest and most expensive U.S. cities has actually fallen this
year, and within most metro areas, the anxieties of prospective
home buyers continue to rise. These and other signals in the ZHCI
data suggest that home price appreciation and housing confidence
could weaken in the coming months."
About Zillow
Zillow® is the leading real estate and
rental marketplace dedicated to empowering consumers with data,
inspiration and knowledge around the place they call home, and
connecting them with the best local professionals who can help. In
addition, Zillow operates an industry-leading economics and
analytics bureau led by Zillow's Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of
economists and data analysts produce extensive housing data and
research covering more than 450 markets at Zillow Real Estate
Research. Zillow also sponsors the quarterly Zillow Home Price
Expectations Survey, which asks more than 100 leading economists,
real estate experts and investment and market strategists to
predict the path of the Zillow Home Value Index over the next five
years. Zillow also sponsors the bi-annual Zillow Housing Confidence
Index (ZHCI) which measures consumer confidence in local housing
markets, both currently and over time. Launched in 2006, Zillow is
owned and operated by Zillow Group (NASDAQ: Z and ZG), and
headquartered in Seattle.
Zillow is a registered trademark of Zillow, Inc.
About Pulsenomics:
Pulsenomics LLC is an independent research and consulting firm
that specializes in data analytics, new product and index
development for institutional clients in the financial and real
estate arenas. Pulsenomics also designs and manages expert surveys
and consumer polls to identify trends and expectations that are
relevant to effective business management and monitoring economic
health. Pulsenomics LLC is the author of The Home Price
Expectations Survey™, The U.S. Housing Confidence Survey, and The
U.S. Housing Confidence Index. Pulsenomics®, The Housing Confidence
Index™, and The Housing Confidence Survey™ are trademarks of
Pulsenomics LLC.
i The ZHCI is computed by Pulsenomics from data
compiled by the Zillow-sponsored U.S. Housing Confidence Survey
(HCS), consisting of more than 10,000 completed household
interviews with adult landline and cellphone users nationwide. ZHCI
is a diffusion index measured on a 100-point scale, with readings
above 50 indicating a surplus of confidence in the housing market.
This edition of the ZHCI is derived from data collected in the
July 2016 edition of the HCS,
conducted between July 6 and July 14,
2016. At a 95% confidence interval, the theoretical margin
of sampling error for an aggregated, household-weighted sample of
10,000 (comprised of 20 metro-level probability samples of 500
each) is +/- 1.2%, and larger for sub-groups (e.g., +/- 1.5% for
all homeowner households, and +/- 2.0% for all renter households).
More than 350,000 consumer responses pertaining to the real estate
market where each survey respondent lives are recorded by
Pulsenomics to produce each edition of the ZHCI. To view or
download all 252 index values that comprise each edition of the
ZHCI data set, or to learn more about the ZHCI calculation
methodology, please visit Zillow.com/research or
pulsenomics.com.
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SOURCE Zillow