Survey Shows Consumers have Reservations regarding Purchase of REO's

Real estate search engine Trulia.com released the findings of a survey conducted last month that queried consumer sentiment regarding the purchase of foreclosed homes.

The survey found that 69 percent of U.S. adults feel that there are negative aspects associated with buying a foreclosed home, but more than half said they would be at least somewhat likely to consider such a transaction.

However, it's clear that there is significant apprehension surrounding the purchase of foreclosed properties, as 69 percent noted that hidden costs were a drawback to buying such a property.

Another 35 percent said they considered them risky, while 33 percent fretted about a potential drop in value.

"What's striking about these findings is that while U.S. consumers recognize the purchasing opportunity presented by foreclosed homes, there are definitely some reservations about the process," said Pete Flint, co-founder and CEO of Trulia.

Interestingly, nearly 75 percent of U.S. adults aged 18-34 feel that there are negative aspects of purchasing a foreclosed home versus just two-thirds of those aged 35 and older.

And 20 percent of U.S. adults said that having a "personal connection" with someone who lost their home by way of foreclosure is a negative aspect of purchasing a foreclosed home.

Trulia said searches for foreclosure listings on its site have more than tripled in the first quarter of 2008, rising by a whopping 214 percent.

The survey was conducted online within the United States by Harris Interactive between April 23 and 25, among 2,033 U.S. adults aged 18 years and older.