Homeowners Resigned to a Multiyear Recovery

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Nearly half of all homeowners whose properties lost value during the housing recession expect it to will six years or more for their homes to return to pre-recession levels and nine out of ten expect it to take at least three years, according to a survey released yesterday by Pew Research.

In the March survey of 1222 homeowners about half (47 percent) say their home is worth less now than before the recession began, and 31 percent say its value has stayed the same. Just 17 percent say their home is worth more.

Of those who have lost value, 86 percent say they expect it to take at least three years for values to recover to pre-recession levels; 42 percent say it will take at least six years; and 10 percent say it will take more than 10 years.

The drop in home prices has been felt across the board by all income, age and ethnic groups. the drop in home prices has been felt across the board, according to the Pew Research survey. The survey found that white, black and Hispanic homeowners say in roughly equal proportions that the value of their home has declined since the start of the recession( although Hispanics are more likely to report being underwater on their mortgage). Similarly, younger, middle-aged and older homeowners are equally likely to say their home has lost value.

Homeowners with at least some college education are more likely than those who never attended college to say their home has decreased in value. More than half of those with at least some college education (53 percent) say their home is worth less now than it was before the recession, compared with 39 percent of homeowners who never attended college. Similarly, higher and middle-income homeowners are more likely than those on the lower end of the income scale to say their home is now worth less than it was before the recession

Despigte their experiences, homeowners who have lost value still value homeownership as an investment. Fully 82 percent of homeowners who say their home is worth less now than before the recession began either strongly (37 percent) or somewhat (45 percent) agree that homeownership is the best long-term investment a person can make. Among homeowners whose home increased in value during the recession, this confidence is even more pronounced. Half (49 percent) strongly and 41 percent somewhat agree with this view.

Overall, homeowners are more positive than renters about the financial wisdom of owning a home; 41% of homeowners strongly agree that this is the best long-term investment a person can make, compared with just 31% of renters. (The survey sample included 57% of respondents who own a home and 30% who are renters; the remainder has other arrangements, such as living with family members.)

For a copy of the Pew study, click on the link at the top of this story.