Posted Jul 18, 2010

From Real Trends Email Update #1222

Poll: Few homeowners regret purchase

Surprise! Ninety percent of homeowners say they don't regret buying their home despite a nationwide tsunami of foreclosures, short sales and loan modifications, according to a national poll commissioned by Bankrate.com. By contrast, just 9 percent of homeowners answered "yes" to the question, "Do you have any regrets about buying your current home?"

Americans' contentment with their homes is probably the biggest surprise in a June 24 to June 27 poll of 1,001 randomly selected adults, conducted by Princeton Survey Research Associates.

Here's a result that's not so startling: Homeowners have become savvier about their mortgages.

In this year's survey, only 8 percent of homeowners with mortgages didn't know whether they have a fixed-rate or adjustable-rate loan, or something more exotic. Compare that to two years ago, when a Bankrate-commissioned poll found 26 percent of borrowers couldn't identify their mortgage type.

Among homeowners who regret having bought their homes, 31 percent said they feel woeful because they are unable to sell and move on. Another 22 percent said it was because they couldn't afford the monthly mortgage payments. Some 23 percent said they have regrets for other, unspecified reasons. The rest volunteered their own reasons for wishing they hadn't bought their home.

There's one caveat to these stats. Overall, the poll of homeowners has a margin of error of plus or minus 4.2 percentage points. But the number of regretful homeowners is so small that the figures in the accompanying chart have a margin of error of plus or minus 14 percentage points.

Sellers continue to reduce prices

Some 24 percent of listings currently on the market in the United States as of July 1, 2010, experienced at least one price reduction, according to Trulia.com. This represents a 9 percent increase from the previous month. The total dollar amount slashed from home prices was $27.3 billion and the average discount for price-reduced homes continued to hold at 10 percent off of the original listing price.

Many of the largest U.S. cities saw significant increases in price reduction levels this month with 22 of the top 50 cities across the U.S. experiencing price reduction levels at 30 percent or more, compared to just 10 cities in the previous month. Minneapolis leads the way with 40 percent of its home listings experiencing at least one price cut. This is the third straight month that Minneapolis has held the top spot and no other city has reached the 40 percent mark since Trulia started tracking home price reductions in April 2009.