May 6--Four out of 10 Americans think we're in a real-estate bubble that's likely to burst within three years, according to a poll released Thursday by Costa Mesa-based Experian and The Gallup Organization.
And for the second straight month, consumers appeared concerned about their credit ratings and their ability to pay their debts, survey authors said.
The monthly Experian-Gallup Personal Credit Index, launched in March, dropped from an initial "baseline" score of 100 to 82 in April, company officials said. May's survey shows only slight improvement, with a score of 86.
"We're starting to see some real concerns out there on the consumers' part about what is the prospect for the economy," said Ed Ojdana, group president of Experian Interactive.
Ojdana and Dennis Jacobe, Gallup's chief economist, said consumers likely are starting to feel squeezed by rising fuel prices and interest rates.
Most of the respondents were upbeat about the housing markets in their area: Seven out of 10 believe housing prices will continue rising, and six out of 10 don't see a real-estate bubble.
But Jacobe said it was significant that so many people think there is a housing-price bubble.
"I think most people who sort of know housing would be surprised that four out of 10 say there's a housing bubble in their market," he said. "In 2000, how many investors thought we had a bubble in the stock market?"
Interest rates aren't a major worry. Seventy-five percent of those polled expect mortgage rates to rise, but half of those respondents thought they wouldn't go up more than one percentage point.
That may be why one in five consumers planning to take out a home loan in the next six months will choose an adjustable-rate mortgage, the survey found.
Full Article: http://www.builderonline.com/industry-news-print.asp?sectionID=26&articleID=127477
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