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Global CommunicationsPRUDENTIAL REAL ESTATEOUTLOOK SURVEY2ND QUARTERJuly 11, 2012                                        1
Survey BackgroundObjective: Gather insight on the factors impacting buyer/seller real estate decisions in today’s economy...
Key Findings Confidence is rising in homeownership and the recovery of the U.S. real estate market  – 69% believe that re...
Confidence in rising in real estate’s recovery    Confidence increased among all audiences; Recent Transactors are the mo...
Optimism is returning to the real estate market    Favorability is up 12 points from 2011, and 4 points from Q1          ...
Real estate is still considered a good investment Despite market volatility of previous years, 69% believe real estate is...
Owning a home remains very important Owning a home is still “very important” to nearly 4 in 5 respondents                ...
Reasons for homeownership favor the emotional side Safety, control and family continue to be more important than financia...
Now is a great time to buy a home 96% agree that with interest rates at historically low levels, now is a great time to b...
Homeownership is good for the economy Even though it is more difficult to buy a home now than it was for our parents’ gen...
Homeownership is part of the American Dream 42% strongly agree that homeownership is an important part of the American Dr...
Contemplators are waiting for the right time to buyor sell Lingering economic uncertainty and fears of being unable to se...
Potential buyers and sellers have to be more careful 93% agree that the housing crisis reminded them to be more careful a...
Having a good agent is important 28% strongly agree that having a good agent can help them make the right choices when it...
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Prudential 2012 consumer attitudes survey q2 findings final

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The new quarterly Prudential Real Estate Outlook Survey revealed that nearly two-thirds (64%) of respondents had a favorable perception of the U.S. housing market, a 4-point jump from the first-quarter 2012 survey and a 12-point increase from first quarter 2011. As a matter of fact, nearly seven out of 10 Americans surveyed (69%) also indicated that real estate is a good investment – that’s up 6% from first-quarter 2012 survey results and 17% from first quarter 2011.

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Transcript of "Prudential 2012 consumer attitudes survey q2 findings final"

  1. 1. Global CommunicationsPRUDENTIAL REAL ESTATEOUTLOOK SURVEY2ND QUARTERJuly 11, 2012 1
  2. 2. Survey BackgroundObjective: Gather insight on the factors impacting buyer/seller real estate decisions in today’s economy.Audiences: Respondents are aged 25-64 with a household income of at least $50,000, and either recently bought/sold a home or are considering buying/selling a home. Similar studies were conducted in February 2011 and Q1 2012 and are used as a benchmark periodically throughout this report.Total Respondents: 1,250 Targeted sample of Americans “in the market” for buying or selling a home – 500 “Recent Transactors” – Bought/sold home within the last year – 500 “Likely Transactors” – Indicated they are likely to buy/sell home within next year – 250 “Contemplators” – Considered buying/selling within last year, but did not The margin of error is ± 2.8% for all respondents and higher for subgroups.Methodology: Interviews were conducted online by Penn Schoen Berland, between May 22 and June 1, 2012. 2
  3. 3. Key Findings Confidence is rising in homeownership and the recovery of the U.S. real estate market – 69% believe that real estate is a good investment despite the market volatility of the past few years, up 6 percentage points from the first-quarter 2012 survey and 17 percentage points from the first-quarter 2011 survey. – 72% expressed confidence that the real estate market and property values will improve during the next two years, including a 6- point jump among those “very confident” or “confident” vs. the first quarter 2012, and a 14-point gain in this subset over the first quarter 2011. The Recession has not deterred Americans from the goal of homeownership – Nearly two-thirds (64%) of respondents have a favorable perception of the U.S. housing market, up from 60% in the first quarter 2012 and 52% in first quarter 2011. However, Americans are more cautious than before – 30% strongly agree that the housing crisis reminded them they have to be more careful about buying or selling a home. – Owning a home is still very important to 78% of respondents, unchanged from the first-quarter 2011 survey. Belief that now is a good time to buy remains high – With interest rates at historically low levels, 96% of respondents at least “somewhat agree” that now is a great time to buy a home. That’s unchanged from the first-quarter 2012 survey. Emotional reasons outweigh financial reasons for owning a home – Survey respondents emphasized “control of living space,” “more space for family,” “safer neighborhood,” and “good place to raise a family” before “a good investment,” “financial security” and “tax benefits.” Caution remains – 30% of respondents “strongly agree” that the housing crisis reminds them to be more careful about buying or selling a home, up 2 points from the first-quarter 2012 survey. – 65% of respondents said that securing a mortgage is more challenging that it ever was before the market crisis, a 7-point jump from the first quarter 2012. – Among those considering a real estate transaction, 39% expressed concern about selling their home, an 11-point increase from the first-quarter 2012 survey and 10 points higher than first quarter 2011. Importance of Real Estate Agents – Nearly three-quarters of respondents (74%) said it’s more important than every to work with a good real estate agent for best success in buying or selling a home, up from 71% in the first quarter 2012 survey and from 67% in first quarter 2011. 3
  4. 4. Confidence in rising in real estate’s recovery  Confidence increased among all audiences; Recent Transactors are the most confident in the recovery All Q2 2012 39% 33% 27% Q1 2012 33% 37% 30% Considering the U.S. 2011 25% 43% 32%economy’s ongoing recovery Recent Transactorfrom the "Great Recession," Q2 2012 48% 26% 25% how confident do you feel Confident Q1 2012 41% 31% 28% that the real estate market Somewhat 2011 26% 41% 33% and property values will at Likely Transactorleast begin to recover in the Not Q2 2012 42% 37% 22% next year or two? Q1 2012 34% 36% 29% 2011 28% 43% 29% Contemplator Q2 2012 18% 39% 44% Q1 2012 12% 52% 36% 2011 17% 45% 38% All Recent Transactor Likely Transactor Contemplator Q2 2012 Q1 2012 2011 Q2 2012 Q1 2012 2011 Q2 2012 Q1 2012 2011 Q2 2012 Q1 2012 2011 Very confident 16 11 5 23 16 6 16 10 5 2 2 4 Confident 23 22 20 25 25 20 26 24 23 16 10 13 Somewhat confident 33 37 43 26 31 41 37 36 43 39 52 45 Not very confident 21 24 27 19 21 27 17 24 24 35 31 34 Not at all confident 6 6 5 6 7 6 5 5 5 9 5 4 4
  5. 5. Optimism is returning to the real estate market  Favorability is up 12 points from 2011, and 4 points from Q1 All Q2 2012 64% 37% Q1 2012 60% 40% 2011 52% 48% Recent Transactor Q2 2012 69% 31% Based on your personalexperience and/or what you Q1 2012 71% 29% know about the process of 2011 57% 43% Favorable Likely Transactor buying and selling homes, what is your overall Unfavorable Q2 2012 68% 32%perception of the residential Q1 2012 56% 43% real estate market in the 2011 53% 47% United States? Contemplator Q2 2012 42% 59% Q1 2012 56% 43% 2011 41% 59% All Recent Transactor Likely Transactor Contemplator Q2 2012 Q1 2012 2011 Q2 2012 Q1 2012 2011 Q2 2012 Q1 2012 2011 Q2 2012 Q1 2012 2011 Favorable 24 20 14 33 31 16 24 17 14 4 17 9 Somewhat favorable 40 40 38 36 40 41 44 39 39 38 39 32 Somewhat unfavorable 28 29 33 26 21 28 24 30 32 41 30 46 Unfavorable 9 11 15 5 8 15 8 13 15 18 13 14 5
  6. 6. Real estate is still considered a good investment Despite market volatility of previous years, 69% believe real estate is a good investment, up sharply from Q1 and from 2011 Roughly 3 in 4 recognize the importance of working with a good real estate agent when buying or selling a home, a steady increase from the previous two surveys Financing a home remains a concern among respondentsPlease indicate your level of agreement or disagreement All Recent Transactors Likely Transactorswith the following statements.IF RECENT/LIKELY TRANSACTOR Q2 Q1 Q2 Q1 Q2 Q1 2011 2011 2011Showing % Strongly Agree / Agree 2012 2012 2012 2012 2012 2012Given the dynamics and challenges of today’s real estatemarket, I think it is more important than ever to work with a 74 71 67 75 71 70 71 73 64good realtor for the best success in buying or selling a homeEven though my house is worth less, I know I can also buy a 67 64 64 67 63 -- 66 66 65new house at a lower priceI think real estate is a good investment despite the market 69 63 52 72 63 52 65 61 53volatility of the past few yearsFinancing/getting a mortgage is more challenging than it 65 58 61 67 56 62 63 60 60ever was before the market crisisRationally, I understand housing prices are down and byhistorical standards this might be a good time to buy real 43 36 -- 42 39 -- 44 33 --estate, but my emotions and concerns hold me back frombuying or selling a homeI regret not selling my home in the past year 19 16 12 -- -- -- 19 16 12I regret selling my home in the past year 20 13 10 20 13 10 -- -- -- 6
  7. 7. Owning a home remains very important Owning a home is still “very important” to nearly 4 in 5 respondents How important is owning a home to you? 1% 2% Q2 20% 78% 2012 1%2% Q1 19% 78% 2012 Not at all important Not very important Somewhat important Very important All Recent Transactor Likely Transactor Contemplator How important is owning a home to you? Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Very Important 78 78 81 82 78 78 70 68 Somewhat Important 20 19 17 16 19 19 26 27 Not very important 2 2 1 2 2 3 4 2 Not at all important 1 1 1 0 0 1 0 2 7
  8. 8. Reasons for homeownership favor the emotional side Safety, control and family continue to be more important than financial considerationsWhen thinking about the reasons you All Recent Transactor Likely Transactor Contemplatormight own a home, how important areeach of the following? Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012Showing % Very ImportantIt allows me to have more control over 70 69 69 66 73 73 65 66my living spaceIt allows me to have more space for my 62 63 60 60 67 67 55 60familyIt allows me to live in a saferneighborhood where people look after 61 61 61 62 63 60 57 57each otherIt gives me a good place to raise a family 59 59 58 58 62 61 54 56It is a good investment 56 55 58 54 57 56 51 55It gives me a sense of pride or 57 54 59 54 62 56 42 48accomplishmentIt gives me financial security andsomething I can borrow against if 43 45 45 47 45 47 33 36neededIt gives me tax benefits 46 45 48 44 48 47 41 42It means I can live in an area with better 43 44 45 43 46 46 34 43schoolsIt allows me to live in a more convenient 40 43 41 44 44 44 30 38location closer to family & friendsIt allows me to live in a community 45 42 47 48 48 41 35 33where people share my values 8
  9. 9. Now is a great time to buy a home 96% agree that with interest rates at historically low levels, now is a great time to buy a home With interest rates at historically low levels, now is a great time for me to buy a home Q2 2012 39% 35% 22% 3% 2% Q1 2012 39% 35% 22% 3% 1% Strongly agree Agree Somewhat agree Somewhat disagree Disagree How strongly do you agree or All Recent Transactor Likely Transactor Contemplator disagree with the following statement: With interest rates at historically low levels, now is a Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 great time for me to buy a home TOTAL AGREE 96 96 96 96 95 98 93 94 Strongly agree 39 39 40 42 42 40 29 30 Agree 35 35 36 34 33 38 35 32 Somewhat agree 22 22 20 20 20 20 29 32 TOTAL DISAGREE 5 4 4 5 5 2 7 6 Somewhat disagree 3 3 3 3 2 1 5 5 Disagree 2 1 1 2 3 1 2 1 9
  10. 10. Homeownership is good for the economy Even though it is more difficult to buy a home now than it was for our parents’ generation it remains an important part of the American Dream All Recent Transactor Likely Transactor Contemplator How strongly do you agree or disagree with the following statements? Showing % Strongly Agree Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 TOP HALF Homeownership is an important part of the 42 39 42 42 46 41 34 29 American Dream With interest rates at historically low levels, 39 39 40 42 42 40 29 30 now is a great time for me to buy a home Homeownership is good for the economy 41 38 42 40 45 37 30 33 Finding the right home and community is 33 31 34 36 36 31 27 21 crucial to helping my family be happy The housing crisis reminded me that I have to be more careful about buying or selling a 30 28 24 26 31 27 41 34 home It’s more difficult to buy a home now than it 34 27 31 26 34 27 37 29 was for my parents’ generation Having a good realtor can help me make the right choices about the type of home and 28 26 29 29 29 27 23 17 community I want Having a realtor when buying or selling a 22 19 25 22 23 19 14 12 home is worth the fee I trust my realtor’s advice 18 16 25 22 16 15 9 6 10
  11. 11. Homeownership is part of the American Dream 42% strongly agree that homeownership is an important part of the American Dream, up 3 points from the first quarter Homeownership is an important part of the American Dream Q2 2012 42% 35% 19% 3% 1% Q1 2012 39% 35% 22% 3% 1% Strongly agree Agree Somewhat agree Somewhat disagree Disagree How strongly do you agree or All Recent Transactor Likely Transactor Contemplator disagree with the following statement: Homeownership is an important part of the American Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Dream TOTAL AGREE 96 96 97 95 97 97 95 95 Strongly agree 42 39 42 42 46 41 34 29 Agree 35 35 37 34 31 33 38 42 Somewhat agree 19 22 18 19 20 23 23 24 TOTAL DISAGREE 4 4 4 5 3 4 5 5 Somewhat disagree 3 3 2 3 3 3 4 4 Disagree 1 1 2 2 0 1 1 1 11
  12. 12. Contemplators are waiting for the right time to buyor sell Lingering economic uncertainty and fears of being unable to sell current home are holding back Contemplators IF CONTEMPLATOR: Earlier in the survey, you indicated that you’ve been considering buying or selling a home for the past year. For what reasons, if any, have you not yet bought or sold a home? Select all that apply. 47% Waiting for right opportunity 47% 43% 39% I’m worried I won’t be able to sell my current home 28% 29% 38% Instability of U.S. economy 37% 27% 38% I just haven’t found the home I want yet 29% 37% 34% I’m worried that home values haven’t stopped dropping 24% 25% 29% Trying to save more money 36% 29% 24% Not sure about finances 26% Q2 2012 20% 24% Q1 2012 I’m not confident I can set the right price for my home 15% 20% 20% 2011 I’m nervous about having a new mortgage 16% 15% 18% I’m worried about my job/employment 18% 13% 6% Others 8% 11% 12
  13. 13. Potential buyers and sellers have to be more careful 93% agree that the housing crisis reminded them to be more careful about buying or selling a home, unchanged from the previous wave The housing crisis reminded me that I have to be more careful about buying or selling a home Q2 2012 30% 37% 26% 4% 2% Q1 2012 28% 37% 28% 5% 2% Strongly agree Agree Somewhat agree Somewhat disagree Disagree How strongly do you agree or All Recent Transactor Likely Transactor Contemplator disagree with the following statement: The housing crisis reminded me that I have to be Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 more careful about buying or selling a home TOTAL AGREE 93 93 92 93 94 94 99 92 Strongly agree 30 28 24 26 31 27 41 34 Agree 37 37 38 33 38 42 36 35 Somewhat agree 26 28 50 34 25 25 22 23 TOTAL DISAGREE 6 7 8 6 6 5 2 8 Somewhat disagree 4 5 5 4 5 4 1 7 Disagree 2 2 3 2 1 1 1 1 13
  14. 14. Having a good agent is important 28% strongly agree that having a good agent can help them make the right choices when it comes to buying a home, up 2 points from the first quarter Having a good realtor can help me make the right choices about the type of home and community I want Q2 2012 28% 34% 28% 6% 3% Q1 2012 26% 36% 29% 6% 3% Strongly agree Agree Somewhat agree Somewhat disagree Disagree How strongly do you agree or All Recent Transactor Likely Transactor Contemplator disagree with the following statement: Having a good realtor can help me make the right Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 Q2 2012 Q1 2012 choices about the type of home and community I want TOTAL AGREE 90 91 90 92 90 93 90 86 Strongly agree 28 26 29 29 29 27 23 17 Agree 34 36 35 35 35 37 30 36 Somewhat agree 28 29 26 28 26 29 37 33 TOTAL DISAGREE 9 9 9 8 9 8 9 15 Somewhat disagree 6 6 6 5 6 5 8 10 Disagree 3 3 3 3 3 3 1 5 14
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