Kitchen & Bath Design News

OCT 2013

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Consumer Buying Trends { Demographics & buying patterns for the home } ® A CYGNUS BUSINESS MEDIA PUBLICATION SALES OFFICES NATIONAL SALES MANAGER MIDWEST Michael Mandozzi 3030 W. Salt Creek Lane Arlington Heights, IL 60005 Phone: 847-454-2715 Email: mike.mandozzi@cygnus.com Consumer Mindset About Housing Improving, Survey Finds WASHINGTON, DC — As housing construction and home sales continue to rise, public perceptions of the housing market – negatively impacted by the recent recession – have also improved. In fact, Americans now overwhelmingly believe that owning a home is a good fnancial decision, and a majority of renters say homeownership is one of their highest priorities for the future – positive news for a housing and kitchen/bath market whose continued recovery is largely dependent on new construction and existing-homes sales. According to the 2013 National Housing Pulse Survey, a major new study conducted by the National Association of Realtors, renters are also thinking more about purchasing a home now than in past years, while the number of people who say they prefer to rent has declined. The NAR survey also revealed less concern about jobs and foreclosures than in 2011, the last time the survey was conducted. Despite the optimism, a fair degree of uncertainty lingers regarding the overall economy and certain aspects of homeownership, researchers found. As in 2011, many survey participants expressed concern about the housing market's collapse and subsequent drop in home values. Many homeowners say they would like to move, but do not think they can sell their home in the current market. Just under half say they do not think they could sell their home for what they paid for it. Still, Americans overwhelmingly believe that buying a home is a sound fnancial investment. "Homeownership matters to Americans, who consistently realize the many benefts it provides to communities, families and the nation's economy," said Gary Thomas, president of the Washington, DC-based NAR. "Due to high housing afordability and today's interest rates, it makes sense for people to consider homeownership over renting. In fact, in many parts of the country it's cheaper to own a home than to rent one." The NAR survey, which measures consumers' attitudes and concerns about housing opportunities, found that 80% of Americans believe buying a home is a good fnancial decision, while more than two-thirds (68%) said that now is a good time to buy a home. Since the last survey in 2011, more renters are now thinking about purchasing a home, up from 25% to 36%, while those who say they prefer to rent dropped from 31% to 24%, according to the NAR. Half of renters say that eventually owning a home is one of their highest personal priorities, up from 42% to 51%, the trade association added. Attitudes toward the housing market have also improved in recent years, the NAR noted. Nearly four in 10 Americans (38%) identifed an increase in activity within their local housing market in the past year, compared to just 22% who reported a slowdown in activity. By contrast, in 2011 some 51% of those surveyed reported a slowdown in activity. There is also less concern now than in the past about the decline in home values; a majority of survey participants said housing prices in their area are more expensive than a year ago. In addition to these improved attitudes about the housing market, respondents also showed an improved outlook about the national economy. Just under half (48%) said job layofs and unemployment are a big problem, down from 61% in 2011. The concern over foreclosures showed a steep decline from 2011, when 47% characterized distressed properties as "very" or a "fairly big problem." By comparison, today only 29% say it's a problem, the NAR observed. When asked for reasons why homeownership is important, respondents' top reasons underscored basic American values and freedoms; they were building equity, wanting a stable and safe environment, and the freedom to choose where to live. While these reasons have remained virtually unchanged since 2011, they vary slightly according to demographics. The top scoring reason for African-Americans and Hispanics was that homeownership provides stability and a safe environment; women also placed more emphasis on environmental factors than men. Non-college graduates placed stronger emphasis on public schools, owning a home before retirement, and living in a safe and stable environment. For many Americans, the perceived obstacles to homeownership have remained unchanged over the years; low wages, student loan debt, and little savings for a down payment and closing costs continue to make it difcult for many to become homeowners. Respondents across the board – young and old, college graduates and non-graduates – consider student loan debt to be a large obstacle. "Student loan debt is a concern for many consumers in today's market, especially frst-time buyers," said Thomas. "Buyers with student loan debt may fnd it difcult to access mortgage credit, as well as save for a down payment." He added: "Pending mortgage fnance regulations requiring higher down payments could also contribute to the already tight lending environment." 61% Concerned About Home Foreclosures 47% Concerned That Home Values Will Decline 36% View That Buying a Home is a Good Financial Decision 72% People Who Prefer to Rent Instead of Buy a Home 31% 24% Renters Thinking About Buying a Home 25% 36% Renters Who Say Owning a Home is One of Their Highest Priorities 42% WEST/SOUTHWEST Kim Carroll 7355 19th Avenue NW Seattle, WA 98117 Phone: 206/781-0714; Fax: 206/473-0724 E-mail: kim.carroll@cygnus.com PRODUCT & LITERATURE SHOWCASE/CLASSIFIED ADS Nancy Campoli 558 Prospect Avenue River Vale, NJ 07675 Phone: 800/547-7377 x6127 E-mail: nancy.campoli@cygnus.com EDITORIAL OFFICES 3 Huntington Quadrangle, Suite 301N Melville, NY 11747 Janice Anne Costa, Editor Tel: 631/963-6233 E-mail: janice.costa@cygnus.com Anita Shaw, Managing Editor Tel: 631/963-6209 E-mail: anita.shaw@cygnus.com Kimberly Berndtson, Senior Editor Tel: 920/563-1722 E-mail: kim.berndtson@cygnus.com CORPORATE HEADQUARTERS 1233 Janesville Ave. Fort Atkinson, WI 53538 Phone: 631/845-2700; Fax: 631/845-2741 PUBLISHING HEADQUARTERS Eliot Sefrin, Publisher Emeritus E-mail: eliot.sefrin@cygnus.com 48% Concerned About Job Layoffs Joe May 297 Concord Road Marlborough, MA 01752 Phone: 800/547-7377 x2718 E-mail: joe.may@cygnus.com 3030 W. Salt Creek Lane, Suite 200 Arlington Heights, IL 60005 IMPROVING MINDSET OF CONSUMERS IN 2013 COMPARED TO 2011 2011 2013 EAST/SOUTHEAST Joanne Naylor 540 Lee Court Wyckoff, NJ 07481 Phone: 201/891-9170; Fax: 201/839-9161 E-mail: joanne.naylor@cygnus.com Mark Taussig, Group Publisher E-mail: mark.taussig@cygnus.com 29% REPRINT SERVICES For reprints and licensing please contact Nick Iademarco at Wright's Media 877-652-5295 ext. 102 or niademarco@wrightsmedia.com. 25% 80% SUBSCRIPTIONS, BACK ISSUES 1233 Janesville Avenue Fort Atkinson, WI 53538 Tel: 920/563-1761; Fax: 920/563-1704 51% October 2013 Source: National Association of Realtors ForResidentialPros.com | 11 MAILING LIST RENTAL Elizabeth Jackson Tel: 847-492-1350 ext. 18 E-mail: ejackson@meritdirect.com Web site: www.ForResidentialPros.com

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