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Trulia just hosted a call with Pete Flint (CEO, Trulia) and Greg McBride (Senior Financial Analyst, Bankrate) to announce the results of a new Trulia survey “Is home ownership still a part of the American Dream?”  Pete kicked it off by reviewing what’s happened in the real estate market in the last month:

1. January sales and home prices fall to record lows. 9% down in sales, 15% down in prices
2. President’s $75Bn Mortgage Modification Program
3. $8000 dollar first-time home buyer tax credit

And now for the survey results!  On behalf of Trulia, Harris Interactive surveyed more than 2000 US adults between the 20th and 24th of February.  Here are some of the key findings:

• 76% of all American’s still consider home ownership part of achieving the American dream, but consumer agree that economic incentives, among the policies advocated in the housing plan put forward by the administration are not the most important things President Obama could do to solve the housing crisis

• Only 5% said these incentives would be single most important thing President Obama could do to restore faith in the housing market

• Only 21% believe that forcing banks to renegotiate with homeowners is the single most important thing that can be done to stabilize housing

• 53% believe that creating job security is the single most important thing that President Obama can do to restore faith in the American Dream of home ownership.

Contrasting the 75% who believe in the dream of home ownership, Pete shared a great quote from his Trulia Voices question, “Is home ownership still part of the American Dream:”

“NO. After building and paying on my home for 10 years at $1181 a month, it was auctioned today for foreclosure after being on the market for 7 months. And I still owed almost 100 thousand dollars.  The dream of homeownership turned into a nightmare and I don’t want any part of it!”

Pete shared how Trulia’s traffic and user engagement metrics are pointing to the fact that not only is owning a home still part of the American Dream:

• Traffic to the website is up by close to 50% in just 3 month, and page views per visit is up 40%
• Consumer questions have tripled in the last 12 months and while consumers are not buying in the same volume they are certainly heading to Trulia to research and find information.

After Pete spoke, Greg McBride reminded us that housing is a long term investment, not a get rich quick scheme!  The new mortgage modification plan will not solve foreclosure problem alone.  Doesn’t address any things like foreberance programs - and have to remember the impact of job loss.  The plan also doesn’t permit refinancing for many in the hardest hit areas, and for people who make payments on time but are severely underwater.

And a great reminder from Greg: prospective home buyers should get finances in order, save for sizable down payment and pay down debt.

Going back to the survey resutls, Pete shared that families earning less than $35K/year are more confident about Obama’s ability to save the housing market than those earning more, and while being the most hurt in the housing downturn, the Western region of the US has the most confidence compared to other regions.  The survey also found that young, female renters have the most confidence in Obama compared to other demographics.

Some of the questions from the call:

QUESTION: How do the results of this survey compare to previous surveys?
PETE: Looked 6 months ago, and found that 56% of renters believed that home ownership is part of American Dream.  Now 60% of renters believe ownership is part of the American Dream.  (Perhaps an Obama “hope” effect?)

QUESTION: Any thought of the 10K credit in CA?
GREG: By itself won’t turn around the market, but type of incentive that could get people off the sidelines.  For a first-time buyer there’s a lot of uncertainty, so may take time for tax incentives to build momentum.  People need to first know it won’t get worse.

Greg and Pete shared frustration that the plans don’t help people with loans over the conforming limit who are on time and otherwise responsible borrowers, but are stuck underwater - in some cases by more than $100,000.

QUESTION: Did you ask if they believe the American Dream is still achievable?
PETE: Didn’t in question, but what we see in breakdowns is that lower income families are more optimistic.  They see prices decline, so they feel like it’s more affordable - although it may not be the case right away.
GREG: Harder for people to get credit, so although affordable may not be able to get the money beyond a down payment.
PETE: Trulia Voices comments shows a lot of first-time buyers who are excited about getting into housing market in the next 12-24 months.

Is home ownership part of your American Dream?  Tell us what you think on Trulia Voices!

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