ABA Banking Journal
More Americans expect home prices to rise in 2017 than in 2016, according to results from the Federal Reserve Bank of New York’s 2017 SCE Housing Survey, an annual companion to the monthly Survey of Consumer Expectations. The survey showed home price growth expectations at the one-year outlook rose to 5.1 percent in 2017, 1.8 percentage points higher than last year and a record high since the survey began in 2014. Home price growth expectations at the five-year outlook also rose. The majority of respondents, however, continue to view housing as a good financial investment.
Consumers’ expectations for future mortgage rates also increased, with the average one-year ahead mortgage rate expectation at 5.6 percent, up from 5.2 percent in 2016. Sixty-five percent of renters said they view obtaining a mortgage as difficult, although they perceive credit access as becoming easier. The share of renters who said they would prefer or strongly prefer homeownership was 72.3 percent, down slightly from 74.1 percent in 2016. The percentage of owners who said they expect to refinance over the next year declined to 10.2 percent.