Story at a glance
- A ConsumerAffairs survey found that 78 percent of Americans expect the housing market to crash.
- Those who plan to buy a house in the event of a crash have saved an average of $29,504 for their home.
- Overall, respondents were 27 percent more likely to prefer a market correction.
Most Americans expect the housing market to crash soon and expect to purchase a home if it does, according to a recent survey.
ConsumerAffairs found that 78 percent Americans anticipate the market to crash, while 63 percent said they want it to happen. Around three-quarters plan to buy if the market crashes.
Those who plan to buy a house in the event of a crash have saved an average of $29,504 for their home.
Gen Z respondents were most likely to hope the market crashes so they can buy an affordable home. But this generation has the least amount saved — averaging $15,601 in savings.
Yet many borrowers are hopeful the market is moving toward a correction — a steady return to normal market conditions — instead of a crash. Overall, respondents were 27 percent more likely to prefer a correction over a housing crash.
Although the housing market is cooling, prices in July were up by 7.4 percent from a year prior, with the median home price in July sitting at more than $412,500.
Mortgage rates are also surging, moving above 6 percent after falling below 3 percent at the same time last year.
“The 30-year fixed mortgage rate hit the six percent mark for the first time since 2008 – rising to 6.01 percent – which is essentially double what it was a year ago,” Joel Kan, Mortgage Bankers Association’s Associate Vice President of Economic and Industry Forecasting, said in a media release announcing a dip in mortgage applications.
“Higher mortgage rates have pushed refinance activity down more than 80 percent from last year and have contributed to more homebuyers staying on the sidelines,” Kan added.
America is changing faster than ever! Add Changing America to your Facebook or Twitter feed to stay on top of the news.
The ConsumerAffairs survey shows that 91 percent of renters fear that rising mortgage rates will push them out of the market.
Yet most said they believe a crash could also drive down rising rents, which increased on average of $327 within the past year for survey respondents. More than 70 percent of renters expect rent prices to cool down should the housing market crash.
ConsumerAffairs surveyed 1,003 adults on their views of a potential housing crash. The survey included 502 respondents who purchased a home in the last two years and 501 renters.
Published on Sep 14,2022