PHOENIX (Reuters) - Even as a five-year slump in house prices drags on, eight-out-of-10 Americans say bricks and mortar remain the best long-term investment, according to a study released on Tuesday.
The survey by the Pew Research Center’s Social and Demographic Trends project found that 81 percent of respondents see housing as the best investment a person can make, despite a slump in prices that has knocked nearly a third off home values since 2006.
“The resilience of the American public’s belief in the investment value of home ownership is pretty impressive,” Paul Taylor, the project’s director and a co-author of the report, told Reuters.
“In modern economic history we’ve never had a five-year period where home values have fallen as long or as far as they have now,” he added.
U.S. home prices were down by around 32 percent at the start of this year from their pre-recession peak in July 2006, according to the S&P/Case-Shiller Home Price Indices released late last month.
After a pause last year, prices fell again in the first quarter of this year, the Pew Research Center said.
The telephone survey was conducted among a nationally representative sample of 2,142 adults, between March 15 and March 29 this year.
It found that while the American public continued to believe in housing as an investment, there had been some falloff in the intensity of their faith.
It found that 37 percent “strongly” agreed that a home is the best long-term investment a person can make, while 44 percent “somewhat” agreed that homeownership is the best investment a person can make.
When the same questions were put to respondents in a CBS News/New York Times survey two decades ago, 49 percent “strongly agreed” that homes were the best investment, and 35 percent “somewhat agreed,” the study noted.
Nearly half of all homeowners said that their home was worth less now than before the recession began in late 2007, the survey found.
Of that group, the overwhelming majority said it would take at least three years for values to recover, while nearly half said it would take at least six years to recover.
Among those whose homes have lost value, Westerners and Midwesterners were more pessimistic about a speedy recovery than those living in the South and East.
Nearly a quarter — 23 percent — of all homeowners said that if they had it to do all over again, they would not buy their current home.
Reporting by Tim Gaynor; Editing by Jerry Norton