Home Values? Not at Bottom Yet Zillow Says

Home Values? Not at Bottom Yet Zillow Says
  • Opening Intro -

    You may have no plans to sell your home this year or next, but local home values should concern you and be of concern to all Americans for that matter.

-------------------------------------

Some markets will begin to recover in 2012, however.

Home prices have slipped significantly over the past four years, erasing gains made since 2000 and in some markets gains made since the early 1990s. This historic downturn hasn’t brought home prices to the bottom nationally or where prices are set to rebound.

Nearing Bottom?

Some markets, including Los Angeles, have shown signs of improvement, with homes selling more today than they did one year ago. Nationally, home prices fell by 1.1 percent in the fourth quarter of 2011 according to the Zillow Home Value Index. That rate was steeper than what many had expected, but Zillow does share some good news in a still declining market: home values will continue to fall through the end of 2012, but not at the pace seen in 2011.

Zillow’s estimate for 2012 is for home values to decline by 3.7 percent. Zillow puts the average home price in the United States at $146,900. That means home values will drop to about $141,500 by the end of 2012. This trend is important for people who plan to ready their homes for sale in 2013 as the investment you put into your home should translate into a good return on that investment.

Metropolitan Statistical Areas

The Zillow survey looks at the 25 largest metropolitan areas covered by this real estate information marketplace. The largest declines have been forecast for Atlanta (-8.5 percent), Chicago (-7.6 percent) and Seattle (-6.9 percent). A few markets are expected to show rising values including Washington, D.C. at 1.3 percent, Los Angeles at 1.2 percent and Phoenix at 0.6 percent. Miami, one of the hardest hit cities during the Great Recession, is expected to show no change in 2012.

“While it may be disconcerting for homeowners to see values nationally fell at a fairly rapid clip at the end of last year, that trend won’t last through 2012,” said Zillow Chief Economist Dr. Stan Humphries. “The fourth quarter’s weak performance proves that pronouncements of a bottom in home values have been premature, but the good news is that 2012 will prove to be a better year than 2011. In fact, many markets show signs of a bottom this year, although a bottom may continue to elude the nation as a whole in 2012. Fortunately, against a backdrop of modest further declines in home values, we expect that home sales will pick up briskly this year as affordable prices bring more buyers to the table – especially investors and second-home buyers.”

Looking Ahead

Based on Zillow data and polling conducted by Reuters, home values should begin to recover in 2013. That represents a delayed, but welcome recovery, one that is still a long way off, but closer than during the deepest and darkest days of the Great Recession.

-------------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------------

directory photos forms guide

Helpful article? Leave us a quick comment below.
And please share this article within your social networks.

facebook linkedin pinterest

Amazon Affiliate Disclosure: LetsRenovate.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com. The commission earnings are used to defray our cost of operation.

View our FTC Disclosure for other affiliate information.

Categories: Home Values

About Author

Matthew C. Keegan

Matt Keegan is a freelance writer and editor as well as publisher of "Auto Trends Magazine", an online publication. Matt covers campus, consumer, business and financial topics on various websites and weblogs, and has been published in the "Houston Chronicle", "Sam's Club Magazine" and "Wisconsin Golfer".