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Most Consumers in Midwest See Better Year Ahead
COLUMBUS, Ohio -- In its second annual Midwest Economic Index, Huntington Bank found half of those who responded are optimistic about what 2014 will bring, the bank said Tuesday.
They see improved real estate markets, have the same levels of intent next year as this to buy a car, make home improvements and more of them intend to take a vacation in 2014 than did this year.
They will use money they have saved to pay for part or all of their purchases, including spending on the holidays, and reduce their reliance on credit cards, Huntington’s Midwest survey found.
The survey was conducted by Ebiquity, formerly Echo Research, which interviewed 2,169 adult consumers in the markets Huntington serves in Ohio, western Pennsylvania, Michigan, central Indiana, the West Virginia panhandle and northern Kentucky. Respondents offered their answers between Oct. 23 and the 31st and the margin of error is +/-2.1% with a 95% level of confidence.
Highlights of the survey:
- Nearly half, 49%, expect the economy in the Midwest will be better in next year than it was this year compared to 45% a year ago. In Ohio, the figure held firm, 45% see a better year ahead, same as the survey conducted a year ago.
- Overall, 46% said the economy is better today than a year ago when only 39% agreed. Among Ohioans the figures were 42% and 38%.
- Fifty-eight percent see improvement next year in their real estate market compared to 46% a year ago. In Ohio, it was 56% and 42% respectively.
In the Midwest, consumers plan to spend $940 on holiday purchases compared to $959 a year ago but 46% intend to pay for those purchases from money they set aside for such purchases (such as Christmas clubs) while 25% intend to use personal savings. Nearly two in five, or 39%, said they’ll use a credit card with the intent of paying their balances in full when the bills arrive.
More than three in five, 61%, intend to do their holiday shopping at a big-box store, 47% at regional department stores such as Macy’s or Sears, 36% at national retail chains such as Gap or Old Navy and 17% at a specialty store. “Notably, one in five consumers intend to do most of their holiday shopping at a locally owned small business,” the survey found.
As for taking a vacation next year, 76% said they intend to have one in 2014, up 1% from this year and up from 63% in 2012. Among Ohio respondents, 74% said they will (42% definitely, 33% probably), compared to 16% who say they won’t and 10% who aren’t sure.
Of those going on vacation away from home, the average expected to be spent is $3,200, same as this year. Fifty-nine percent intend to pay for their time away in cash saved expressly for this purpose, down 2% from this year; 32% will take the funds from their savings accounts while 34% will use a credit card. Nineteen percent will use their tax refunds to pay for their respites (same as this year), 8% are counting on a bonus and 5% an expected raise in salary.
Twenty-two percent expect they’ll buy or lease a car in 2014 compared to the 21% who a year ago expected to buy a car this year. Overall, 6% said they definitely will buy a car while 16% classified themselves as probable.
As to the breakdown between new- and used-car purchases, 55% responded “new,” 30% “used,” 5% said both new and used and the remaining 10% weren’t sure.
Average anticipated purchase price is $25,200 of which buyers expect to put $8,900 down and finance the balance of $16,300.
For Ohioans, 24% said they expect they’ll buy a car (8% definitely will, 16% probably) while 63% said no and 13% weren’t sure.
As for home improvements, 55% said they’ll pay for them out of money saved expressly for this purpose compared to 53% a year ago while 29% intend to take it out of their savings. Twenty-one percent say they’ll finance the improvements with a credit card and 20% from their anticipated income tax refunds. Six percent say they will use a home-equity loan.
Six percent said they’ll buy a house in 2014, same as a year ago, another 6% weren’t sure and 88% said they won’t. Of the 6% who say they will, only 1% gave a definite yes while 5% said “probably.” Of those who said “no,” 18% allowed the possibility while 70% said “definitely not.” In northern Ohio, 4% responded they would buy a house in 2014, 1% definitely and 3% leaning to “probably.” A year ago, 8% of northern Ohioans said “yes,” 2% and emphatic yes and 7% “probable.” (Rounding errors account for the discrepancy.)
Published by The Business Journal, Youngstown, Ohio.
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