Most state homeowners expect greater home values in 2015

By Matt Masterson - Freeman Staff

July 31, 2014

MILWAUKEE - Over half of Wisconsin homeowners expect to see the value of their houses increase in the next year, according to a study released Wednesday.

BMO Harris Bank polled 2,500 Americans - including 250 from Wisconsin - from April 1-7 this year to gauge homeowners' confidence in the housing market, both in the state and across the nation.

According to the study, 53 percent of Wisconsin homeowners plan on seeing their houses increase in value over the next 12 months, while an even 50 percent say their home's value has already gone up in the last year.

While 30 percent of homeowners said their house lost value within the last year, only 6 percent said they expect it to drop again in the next 12 months.

“The survey results show that there’s a healthy level of optimism among homeowners in Wisconsin. With home prices generally trending upward, very few expect that the value of their home will decline next year, which is great news,” said Lori Day, head of Mortgage Sales, Illinois, BMO Harris Bank. “Current home prices may mean it’s the perfect time to purchase for some prospective buyers.”

The study also asked Wisconsin residents who have mortgages about the forecast for interest rates. Seventy-five percent said they believe the rates will go up, while only 6 percent believe there will be a drop within the next five years.

Twenty-six percent said they have had to delay or end their home-buying plans because of market activity, but an equal percent said they have actually sped up their plans because of the activity.

“Housing affordability remains historically very attractive, despite rising home prices and borrowing costs coming off their lows,”  said Michael Gregory, head of U.S. economics for BMO Capital Markets. “As a result, there continues to be decent demand for homes, assisted from firming household formation.”

On a national level, the study found 59 percent of Americans believe the value of their homes will go up in the next year, with the same proportion saying it has already gone up in the last 12 months.