Wednesday, February 11, 2009

76% of Homes Lost Value in 2008: Zillow

The real estate website Zillow likes to delve into the psyche of the American homeowner, and has periodically been surprised at what it finds. While there is objective evidence that nationwide homeprices have been declining for the past 10 quarters, or 2.5 years, there's been the "Not my house" syndrome. Zillow recently reported that home values lost $3.3 Trillion in 2008. And now, for the first time, the majority of homeowners believe the news, and the news that 1 in 6 mortgage holders are underwater. In the 2008 Q4 Homeowner's Confidence Survey:

More than half of homeowners acknowledge that their own home’s value has declined over the past year:
  • 57% think their home’s value has decreased
  • 18% think their home’s value has stayed the same
  • 25% think their home’s value has increased
In reality, says Zillow, 76% of homes lost value in 2008.

The "not my house" syndrome is so pervasive that Zillow has a "Home Value Misperception Index." But homeowners see the loss, apparently, as just momentary: "Fully 70 percent predict their home’s value will either increase or stay the same in the first six months of 2009." Economists be damned!

Read the Zillow blog post, with links to their studies and indices, here. It seems like a lot of sellers in the Charlottesville MSA are some of those 43% of homeowners who think their home's value has stayed the same or increased. But with large supply and small demand, perhaps there will be a shift this Spring.


Anonymous said...

My guess is that the 25% who think their home's value has increased are all right here in C'ville!

Nalle said...

What are you insinuating? The city told me that my house increased in value by 18%! In all seriousness, although there are hugely inflated prices in Charlottesville (along with expectations) I don't think we hold a candle to the wreckage that is going to occur in the huge-suburb-build-out areas of the U.S. Lets just be thankful that all of the houses that were zoned to be built last year were not!

Real C'ville - The Bubble Blog said...

You have 30 days from date of notice to file an appeal w/ City.

Good luck.