The spring selling season is getting underway and many American homeowners are still expressing frustration over the reality of home prices versus their own expectations as part of the sales process. The Zillow Q4 Homeowner Confidence Survey shows that American homeowners’ confidence in their own homes’ values during the fourth quarter fell to the lowest level in seven quarters, with just one in five (20 percent) believing their own homes’ values increased during 2009. The results of the survey show the “not my home” / denial sentiment that was once prominent has now faded. According to the survey, last year 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.
"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," said Dr. Stan Humphries, Zillow chief economist. "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. We’re not out of the woods yet."