AP/AOL Real Estate Poll Finds: Nearly Half of Americans Believe Housing Prices Will Increase Over the Next Two Years.

50% Say Current Real Estate Costs Are Not Inflated

DULLES, Va. -- A new national AP/AOL Real Estate (www.aol.com/realestate) poll reveals that 49% of Americans believe housing prices in their regions will rise in the next two years. This greatly contrasts with last week's U.S. housing report* stating median house prices are likely to decline more than 10% over the next few years in 20 metro areas.

The AP/AOL Real Estate survey, which provides a snapshot of future homebuyers' perceptions of the residential real estate market, also finds that 50% of Americans think housing in their area is not currently overpriced. However, some do believe prices are inflated (46%), and among them suburbanites (53%) are more likely to say housing in their area is overpriced, compared to urban dwellers (39%) and those living in rural areas (40%).

"Considering recent reports about housing prices going down, I was amazed to discover that so many Americans believe that prices will increase over the next two years," said Samara Jaffe, head of AOL Real Estate. "These survey results really point to how divided homebuyers are about the state of the marketplace - and housing costs are influenced by perception of value, in addition to other economic factors."

Other key poll findings include:

* Men (29%), especially unmarried men (35%), are more likely than women (22%) to say that they are likely to purchase a home in the next two years

* Minorities (33%) are slightly more likely than others to be future homebuyers

* 56% of renters say they are at least somewhat likely to buy a home in the next two years

* The vast majority of recent homebuyers (88%) say the process of buying a home was a positive experience, with more than half (51%) rating their experience as "very positive"

* 62% of recent homebuyers used a professional real estate agent in their searches, and 71% of likely future homebuyers say they will use an agent when they start house hunting

* A majority (53%) of recent homebuyers also used the Internet to assist in their home searches, and 74% of likely future homebuyers expect to use the Internet as well

* 71% of those who used the Internet or plan to use it for their home searches say they have taken a virtual tour of homes

* Quality of construction (87%) ranks as the #1 most important factor when buying or renting a home, followed by price (79%), quality of local schools (68%), possibility of appreciation in value (57%) and closet and storage space (54%)

* Pleasant views (28%), outdoor space/landscaping (40%), proximity to work (42%) and square-footage (45%) rank as less significant factors in choosing a home

* Source: "Report: Housing at the Tipping Point" from Moody's Economy.com, released October 4, 2006

Survey Methodology

The AP/AOL Real Estate poll of 2,001 adults, including 289 recent homebuyers and 401 likely future homebuyers, was conducted September 19-26 by Ipsos. The telephone survey has a margin of sampling error of plus or minus 2 percentage points for all adults, 6 percentage points for recent homebuyers and 5 percentage points for likely future homebuyers.

About the Associated Press 

The Associated Press is the world's oldest and largest newsgathering organization, providing content to more than 15,000 news outlets with a daily reach of 1 billion people around the world. Its multimedia services are distributed by satellite and the Internet to more than 120 nations. For more information, visit www.ap.org.

About AOL

AOL is a global Web services company that operates some of the most popular Web destinations, offers a comprehensive suite of free software and services, runs the country's largest Internet access business, and provides a full set of advertising solutions. A majority-owned subsidiary of Time Warner Inc., AOL LLC is based in Dulles, Virginia. AOL and its subsidiaries also have operations in Europe, Canada and Asia. Learn more at AOL.com.