Today, Trulia and RealtyTrac released the latest result of their ongoing survey tracking the attitude of homebuyers toward foreclosed homes. The most recent survey, conducted in early November by Harris Interactive, showed that Americans are still concerned about the health of the housing market with 58 percent of adults survey expecting a housing recovery to take at least another two years.
As a result of the recent robo-signing debacle, half of of those surveyed said they now have less faith in mortgage lenders, banks and the government (shocker, huh?). Another 35 percent believe the robo-signing issue will delay the housing market’s recovery, while only 6 percent of U.S. adults think the robo-signing issue will have no effect on the recovery of the housing market.
When Americans think the housing market will recover:
------------------------------------------
% of American adults who
believe housing will
Year recover
------------------------------------------
Already recovered 4%
------------------------------------------
2010 1%
------------------------------------------
2011 10%
------------------------------------------
2012 27%
------------------------------------------
2013 24%
------------------------------------------
2014 12%
------------------------------------------
2015 or later 22%
------------------------------------------
“Fifty-eight percent believe recovery will happen after 2012 and more than one in five U.S. adults believe recovery won’t happen until 2015 or later,” said Pete Flint, co-founder and CEO, Trulia. “Government incentives have come and gone and historic lows in interest rates have done little to spur recovery. Then, as if prospective buyers and sellers needed more to be concerned about, the robo-signing issue caused a ‘what’s next?’ fear to surface in the minds of consumers who, frankly, have lost faith in banks and their government to make good decisions.”
Under Water and Out of Options
Nearly half (48 percent) of homeowners with a mortgage admitted that they would consider walking away if their mortgage was under water, an increase compared with May 2010, when only 41 percent said they would consider walking away if their mortgage was under water. Interestingly, men (57 percent) are more likely than women (40 percent) to consider strategic default as an option for dealing with negative equity.
If they became unable to pay the mortgage payments on their current primary residence, two-thirds of U.S. adults with mortgages said they would consider calling the lender and trying to modify the terms of the loan as their first option. The next most popular solution is to have a tenant move in to contribute to the mortgage, but only 10 percent of U.S. adults would do this.
Interest in Buying a Foreclosure
Nearly half (49 percent) of U.S. adults are at least somewhat likely to consider purchasing a foreclosed property, up from 45 percent in May 2010. Despite the rising interest in buying a foreclosed home, an increasing number of people also recognize negative aspects to buying a foreclosure. Over the past six months, the number of U.S. adults who believe there are downsides to buying foreclosed properties has increased to 81 percent, from 78 percent in May 2010. Among those who think there are negative aspects to purchasing a foreclosed home, the top concerns about purchasing a foreclosed property between November 2010 and May 2010 include:
--------------------------------------------------------------
Top Concerns Among Those
with Negative Sentiment
toward Buying a Foreclosure November 2010 May 2010
--------------------------------------------------------------
Hidden costs 66% 68%
--------------------------------------------------------------
Process is risky 54% 49%
--------------------------------------------------------------
Home may lose value 33% 35%
--------------------------------------------------------------
Expected Discount on Foreclosure Purchase
Two-thirds (67 percent) of U.S. adults would expect to pay at least 30 percent less for a foreclosed home than a similar home that was not in foreclosure, and one-third of U.S. adults (35 percent) would expect to pay at least 50 percent less for a foreclosed home. Overall 97 percent of U.S. adults would expect at least some discount on a foreclosed home.
Leave a Reply
You must be logged in to post a comment.