Despite their reputation for optimism, a new survey shows that the vast majority of real estate professionals are cautious or negative on the near term outlook for home prices.
HomeGain's survey of over 1,400 agents and brokers found that 29 percent expect them to decline and 48 percent expect them to stay the same over the next six months. Only 23 percent expect prices to increase in their markets.
"In the first quarter survey many real estate professionals expressed concern over five factors that could potentially impact home prices adversely: rising interest rates, expiration of the home buyer tax credit, persistent unemployment, continued foreclosures and the release of shadow inventory held by the banks," said HomeGain General Manager Louis Cammarosano.
Agents and brokers are more positive about the market outlook today than they were a year ago when the HomeGain study found that 53 percent expected prices to fall in the next six months and 36 percent expected them to stay the same. In fact, the national median existing-home price for all housing types was $164,700 in January, unchanged from a year earlier, according to the National Association of Realtors.
The results of the survey also show a continuing disconnect between what home buyers and sellers think homes are worth. The agents and brokers said sixty-three percent of potential home buyers think that homes are over priced with only 21 percent believing that homes are fairly priced. Seventy-seven percent of home sellers believe their homes are worth more than their agents' recommended selling price.
Agents and brokers expect home prices most likely to decline in Minnesota (82 percent), Oregon (65 percent), Illinois (54 percent), Utah (50 percent), New York (44 percent), New Jersey (44 percent), Nevada (43 percent), Michigan (42 percent), Connecticut (42 percent), and Washington (35 percent) during the next six months.
They see prices most likely to rise in Texas (41 percent), Massachusetts (38 percent), California (37 percent), Nevada (36 percent), Idaho (31 percent), Colorado (31 percent), Alabama (25 percent), Tennessee (25 percent), Arizona (23 percent), and Indiana (22 percent).