Homeowner Survey: Concerns About Future Appreciation, Few Second Mortgages

As home prices decline, the opportunity for future owners to secure affordable deals is stronger than its been in years.

But what about current owners? How do they feel about the state of the housing market? Figures from a nationwide Pew Research Center telephone survey of a random sample of 2,000 adults, including 1,500 homeowners discovered the following:

Nearly half of U.S. homeowners (46%) say their home has increased in value “a lot” over the last few years. But only about half of those homeowners think they’ll enjoy similar appreciation in the future.

The bulk of those surveyed (55%) believe the value of their homes will go up “a little” in the future; 26% still think they’ll enjoy “a lot” of appreciation. Just 10% of homeowners in the U.S. say they think the value of their house will decline in the future.

Moreover, the idea that Americans are using their homes as giant piggybanks may be overblown. Only 20% of homeowners said they have a second mortgage or home equity loan on their property; of those nearly half (45%) said they were using that money to pay for home improvements or repairs.

Less than 3% of all homeowners were using a second mortgage to invest in real estate or buy a second home. About 2% were using a home equity loan to pay credit cards or other debt and about the same percentage bought a car with their proceeds.

Just over 1% were using the money to fund an education.

Despite several years of huge price gains, housing’s relative position in homeowners’ net worth hasn’t changed since a similar survey Pew conducted in 1992: About a third of homeowners say that their home accounts for “all or most” of their personal financial worth, while another third say it accounts for about half.

This should be encouraging, as well, for those contemplating any sort of home mortgage at the moment. Even if prices do not rebound in the near future, you don’t have to lose too much financially.