Let's divide the Home Price Expectation Survey between what the top one quarter, the most aggressive people, the bulls of the market, what did they think? This is the green line on the chart. Then the purple line is the average of all one hundred. Than take the bottom quarter, the bears, the people who think most negatively about pricing going forward, of those hundred - the red line.
We could see that there are some people, the bulls that think by 2017 we are going to see a 33.6 increase in prices, cumulatively, over those years.
The average is 23 percent. But even the negatives, even the bears to the market, the people who are looking at pricing most negatively, are still seeing over the next five years an 11 percent increase in pricing.
Buyers are starting to understand the important of these numbers. Here is a survey done by Redfin. What they ask is what percentage of buyers who believe that prices will rise in the next twelve months. We can see just in the last year, the first quarter of 2012 to the fourth quarter of 2012, the number is climbing. Meaning that just a year ago now, people were saying, "Well there is a 34 percent chance that prices are going to go up in the next 12 months." That number had more than doubled to 71 percent going into 2012.
That is creating an urgency in the buyer. If a buyer knows - if they are sitting on the fence and they believe strongly that prices are going to go up, guess what they are doing? They are jumping off the fence. That is why I believe very strongly that there is going to be continued demand for housing going through 2012.
The next series of my blog will breakdown the Buyers down into two groups:
Generation X and Generation Y Buyers
Move-Up Buyers
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