By Rose Meily
By a 2-to-1 margin, Americans surveyed say high monthly house payments, rather than down payments, are the chief obstacle to buying a home, according to the National Association of Realtors (NAR).
The National Housing Opportunity Pulse Survey of 1,000 adults found six in 10 Americans say high property taxes and rising energy costs could cause them to sell their homes. Almost four in 10 are worried about rising home interest rates. Three in 10 are worried they, or members of their family, could have their homes repossessed because they are unable to pay rising monthly mortgage payments.
“It’s clear America is facing a crisis in housing opportunities with nearly two-thirds of families concerned about being able to find a home they both like and can afford,” said Thomas M. Stevens, NAR president. “Many families are struggling to meet the high cost of homeownership, and increasingly those costs are property taxes and energy utilities.”
In 2003, the average monthly mortgage principal and interest payment was $840. In the past year alone, the average monthly mortgage principal and interest payment has increased 11.5 percent - from $1,015 in April 2005 to $1,132 in April 2006.
The Energy Information Administration estimates that in February 2006 the price of electricity was 12 percent higher than in February 2005, natural gas was up 28 percent and home heating oil was up 25 percent. State and local property taxes for the 2004 fiscal year averaged $1,121 per person, up 13.8 percent from fiscal year 2003, when the average was $985, according to the U.S. Bureau of the Census.
The survey found more than 42 percent of Americans cite the lack of affordable housing in their communities as one of their top three concerns, following high energy costs (82 percent) and the lack of affordable health care (53 percent).
The lack of affordable housing is also affecting renters. Of the renters surveyed, nearly a third worry that the cost of housing is so unaffordable that they will never be able to buy a home.
Support for affordable housing is high. Eight in 10 would be willing to support more affordable homes being made available for people in their communities, and a record 68 percent would be more likely to vote for a candidate who worked to make housing more affordable in their areas, up 6 percent in two years.
John Tripp of Foundation Trust said affordability of housing is clearly a concern, but that buying a home is still the best investment a person can make. Tripp, who is president of the Silicon Valley Association of Realtors, said he still remembers the first home he ever owned.
“It was small and the ceiling sloped. I swear, it was probably a chicken house at one time,” he said. “You had to make sure you stood up slowly, or you could bump your head on the ceiling. But I didn’t care, I was so happy because it was mine.”
Tripp said for people who own homes, especially in the Bay Area, along with pride of homeownership and the social benefits derived from owning a home, comes the rising appreciation rate. In the Bay Area, he said, many homes have appreciated by over 100 percent.
“For non-homeowners, becoming a homeowner is a challenge,” Tripp said, noting that the struggle and sacrifices of owning a home are worthwhile. “It’s still better to invest that money in your own home than give it to a landlord and take advantage of the overall appreciation rate.”
Information in this column is provided by the Silicon Valley Association of Realtors. Send questions to Rose Meily at rmeily@silvar.org.
