Homeowners Unrealistic About Housing Prices?

More homeowners seem to finally be coming to terms with how much their homes are really worth in today’s economy, but some homeowners in the South are still unwilling to face reality, according to a new housing survey.

Zillow’s first quarter Homeowner Confidence Survey finds 60 percent of homeowners believe their homes lost value in the past year. That’s up from 57 percent in February.

But in reality, 80 percent of homes actually were worth less in the past 12 months, up from 76 percent in February.

According to Stan Humprhies, Zillow’s VP Of Data and Analytics, “While homeowners are now more realistic when looking backward, they are still pretty starry-eyed when looking forward with three out of four homeowners believing that their own homes’ prices will increase or be flat over the next six months. Unfortunately, there are few markets expected to perform this well.”

Half of homeowners in the South believe the next six months will bring stabilization of their home values, while 24 percent believe their homes’ value will increase, and 26 percent believe their home’s value will decrease.

Nationwide, 74 percent believe their home will not decline in value in the coming six months, effectively calling a bottom to their homes’ slide.

When asked about future plans to sell, 31 percent of homeowners said they would be at least “somewhat likely” to put their homes on the market in the next 12 months if they saw signs of a real estate market turnaround.

With almost a third of homeowners poised to jump into the market at the first sign of stabilization, this could create a steady stream of new inventory adding to already record-high inventory levels, thus keeping downward pressure on home prices.

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