U.S. households expect home prices to increase 5.1% over the next 12 months, up from an expected 2.6% increase at the same time last year, the Federal Reserve Bank of New York reported in its most recent housing survey, part of its broader Survey of Consumer Expectations. The survey also found that respondents anticipate an average annualized price growth of 2.7% over the next five years.
Respondents expect mortgage rates to rise to 8.7% a year from now and 9.7% in three years’ time, both numbers a series high, the New York Fed reported. At the same time, homeowners’ expected probability of refinancing in the next year was 6.3%, up from 4.1% last year.
Respondents also expect rents to increase by 9.7% over the next 12 months, compared with 8.2% last year. Renters put the probability of ever owning a home in the future at 40.1%, a decrease from 44.4% a year ago and a series low.
