Even as home prices hit record highs in many parts of the country, Americans expect them to continue going up.
A new Gallup poll found that 61 percent of Americans expected home prices to go up next year, up from 55 percent last year and the highest level in more than a decade. Americans in the West are the most optimistic about home prices -- 74 percent predict an increase -- compared to smaller majorities in the Northeast and the Midwest.
More than two-thirds of Americans believe that now is a good time to buy a house, and a third of Americans believe that real estate is the best long-term investment.
“While Americans’ optimism is not yet back to where it was during the housing boom in the mid-200s, it is now the closest it has been since the housing bubble burst in 2007,” Gallup editor Jeffrey Jones wrote in a blog post about the findings. “The continued increase in housing prices leads to questions of whether another housing bubble could occur.”
While a bubble is possible, it’s less likely in today’s market since lenders have implemented stricter standards and low interest rates have tempered the impact of rising home prices on affordability. Today’s homeowners are much more likely to be able to keep up with mortgage payments and less likely to walk away from a property in a downturn.
The percentage of homeowners who are delinquent on their mortgage is at a 10-year low, according to CoreLogic, and continuing to decline.