NEW YORK (MainStreet) -- As the economy makes modest improvements, consumer sentiment continues to strengthen and with it the expectation that home prices will rise over the next 12 months. That's the message from a Bankrate.com report released on Tuesday.S&P Case/Shiller Home Price Index for July, also made public Tuesday, said that prices for single-family homes are rising. The S&P/Case Shiller composite index, which surveys 20 metropolitan areas, gained 6.7% in July year over year. This is below market expectations for a 7.5% rise.
Bankrate.com says only 8% of Americans expect home prices to decline, compared with 53% of consumers who think home prices will rise. The results of the survey were consistent across gender, age, income and education levels. The positive outlook by consumers is similar to the sentiment expressed last year as 55% of Americans correctly forecast that home prices would rise over the ensuing 12 months and 9% wrongly predicted a decline.
“Housing is like the stock market and something consumers look to as an indicator for whether things are headed in the right direction,” said Greg McBride, Bankrate.com’s chief financial analyst. “When home prices fall, everyone gets a little queasy – homeowners and renters alike. The expectation of continued home price increases underscores an expectation for continued improvement in the job market, household finances and the overall economy.”Continue Reading on MainStreet