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Mortgage News Daily combines the expertise of some of the housing industry's leading minds with the power of social media to offer an always lively, constantly evolving web community. MND communicates breaking news, streams video, and provides expert opinion and commentary to a community of interested market professionals and curious consumers.Survey: Home Owner Perceptions of Property Value "Overly Cynical"
Zillow,
the Seattle-based company that collects data on home values throughout the
country, has released results of it's homeowner confidence survey conducted
during the 4th quarter of 2009.
Zillow found that only 20 percent of the 2200 homeowners surveyed felt
that their home's value had increased during 2009 while, based on its own data,
Zillow believes that 28 percent of homes nationally had appreciated in value
during the year.
Based
on this response, Zillow assigned a negative two score to its Home Value
Misperception Index where an index value of 0 would mean that homeowner's perceptions
were in line with actual values. The
original index when the survey was first conducted seven quarters ago was 32. Last quarter the Index was at 10 and one year
earlier it was 11. Zillow interprets the current index to mean that homeowners are "overly cynical"
about the value of their own homes.
Perception was most out-of-line with reality in the Northeast where 22
percent of respondents felt that their homes had appreciated during the year
where Zillow's figures put the actual number at 42 percent.
Nationally, exactly
one half of respondents felt that their home's value had decreased over the
year. Zillow's figures put the actual
decline at 65 percent. On a regional
basis, the Northeast had an actual decline of 49 percent while home owners'
perceptions were at 46 percent; in the Midwest and the South the actual figure
was 64 percent, the perceptions were 46 and 49 percent respectively. 73 percent of western homes decreased in
value while 62 percent of respondents felt their own homes had lost value.
Zillow said that the results of it's survey demonstrate the "not my
home" sentiment, which was once prominent among American homeowners, has
faded. One year ago, nearly half (47 percent) of homeowners believed
values in their local market would decrease in the next six months. However,
when asked about their own home, fewer than one in three (30 percent) believed
their own home's value would decrease. Now that gap has shrunk, with 22 percent
of homeowners believing their local market will lose value over the next six
months and 14 percent believing their own home will lose value.
Where
homeowners appear to be most out of touch with the reality of the market is in
the numbers who felt there had been no change in the value of their homes. Nationally 30 percent felt that there had
been no change where the reality, according to Zillow, is that prices have been
stagnant in only 7 percent of home values.
These numbers were remarkably stable across regions - between 26 and 32
percent felt there had been no change while the actual figures were 6 to 9
percent.
When
asked to look forward, 38 percent of national respondents think their home will
increase in value over the next six months; 14 percent think it will decrease,
and 47 percent see it remaining the same.
The percent expecting an increase was virtually identical in every
region.
The
large number of homeowners who view prices as having been stable over the past
year and expect no change in the coming six months make it difficult to assess
whether the results show unwarranted optimism or insufficient pessimism. However, Zillow chief economist, Dr. Stan
Humphries, said in a press release, "Homeowners are finally succumbing to the notion that, in most
areas, declining home values over the past year are no longer the exception,
they are the rule. Almost three times as
many people believe their home's value will increase over the next six months
as believe it will decrease in value, a level of optimism that is likely to
outpace actual performance in the near-term. Given recent news about the
stabilization of home values in some markets, I can see why homeowners are so
optimistic. However, home values in many markets are still under substantial
downward pressure from high levels of foreclosures and we don't believe we'll
see a definitive bottom nationally until the second quarter of this year."
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YOUR MESSAGE HERE
Survey: Home Owner Perceptions of Property Value "Overly Cynical"
Zillow,
the Seattle-based company that collects data on home values throughout the
country, has released results of it's homeowner confidence survey conducted
during the 4th quarter of 2009.
Zillow found that only 20 percent of the 2200 homeowners surveyed felt
that their home's value had increased during 2009 while, based on its own data,
Zillow believes that 28 percent of homes nationally had appreciated in value
during the year.
Based
on this response, Zillow assigned a negative two score to its Home Value
Misperception Index where an index value of 0 would mean that homeowner's perceptions
were in line with actual values. The
original index when the survey was first conducted seven quarters ago was 32. Last quarter the Index was at 10 and one year
earlier it was 11. Zillow interprets the current index to mean that homeowners are "overly cynical"
about the value of their own homes.
Perception was most out-of-line with reality in the Northeast where 22
percent of respondents felt that their homes had appreciated during the year
where Zillow's figures put the actual number at 42 percent.
Nationally, exactly
one half of respondents felt that their home's value had decreased over the
year. Zillow's figures put the actual
decline at 65 percent. On a regional
basis, the Northeast had an actual decline of 49 percent while home owners'
perceptions were at 46 percent; in the Midwest and the South the actual figure
was 64 percent, the perceptions were 46 and 49 percent respectively. 73 percent of western homes decreased in
value while 62 percent of respondents felt their own homes had lost value.
Zillow said that the results of it's survey demonstrate the "not my
home" sentiment, which was once prominent among American homeowners, has
faded. One year ago, nearly half (47 percent) of homeowners believed
values in their local market would decrease in the next six months. However,
when asked about their own home, fewer than one in three (30 percent) believed
their own home's value would decrease. Now that gap has shrunk, with 22 percent
of homeowners believing their local market will lose value over the next six
months and 14 percent believing their own home will lose value.
Where
homeowners appear to be most out of touch with the reality of the market is in
the numbers who felt there had been no change in the value of their homes. Nationally 30 percent felt that there had
been no change where the reality, according to Zillow, is that prices have been
stagnant in only 7 percent of home values.
These numbers were remarkably stable across regions - between 26 and 32
percent felt there had been no change while the actual figures were 6 to 9
percent.
When
asked to look forward, 38 percent of national respondents think their home will
increase in value over the next six months; 14 percent think it will decrease,
and 47 percent see it remaining the same.
The percent expecting an increase was virtually identical in every
region.
The
large number of homeowners who view prices as having been stable over the past
year and expect no change in the coming six months make it difficult to assess
whether the results show unwarranted optimism or insufficient pessimism. However, Zillow chief economist, Dr. Stan
Humphries, said in a press release, "Homeowners are finally succumbing to the notion that, in most
areas, declining home values over the past year are no longer the exception,
they are the rule. Almost three times as
many people believe their home's value will increase over the next six months
as believe it will decrease in value, a level of optimism that is likely to
outpace actual performance in the near-term. Given recent news about the
stabilization of home values in some markets, I can see why homeowners are so
optimistic. However, home values in many markets are still under substantial
downward pressure from high levels of foreclosures and we don't believe we'll
see a definitive bottom nationally until the second quarter of this year."
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