- Homeowners are largely pleased with the present conditions of the housing market, but when asked about the future in the Zillow Housing Confidence Index, they expressed concern.
- The poor outlook is taking a toll on renters preparing to make a first-home purchase. At the start of the year, 5.2 million renters said they planned to purchase a home in the next year, but that number has recently dipped to 4.9 million.
- Accordingly, in markets where home values have slowed, more potential buyers are looking to make a purchase. However, in areas like San Francisco, Seattle and Denver, the market has slowed, but value is still above the norm. People in those areas said they are more hesitant to purchase.
Millennials who have settled in trendy, high-demand markets have needed to hit the pause button on homebuying plans. That's in contrast to what analysts had predicted for 2015. The strengthening economy, due to job growth, was shaping up as an ideal time for new homeowners to enter the market.
But a strong housing start has given way to some recent leveling off, and that has caused many to be wary of the future.
"Given the out-sized impact of homeownership on personal balance sheets and its interplay with the aspirations and behaviors of U.S. consumers, if this downshift in housing expectations persists, it could portend a longer period of price deceleration and more sluggish consumer spending than some people are currently expecting," said Terry Loebs, founder of Pulsenomics.