In Denial: Zillow Q3 report shows homeowners imagine stable home values

Zillow, which provides home value data online, released its Q3 Homeowner Confidence Survey last week, which showed that half of U.S. homeowners think their homes are worth essentially the same amount as they were one year ago. Amazingly, the study was conducted October 7-9, the same week that the stock market was completely in flames, indicating most survey respondents were either drunk or in serious denial. Zillow’s own value data shows that 74% of homes lost value over the same period. Perhaps mistakenly referring to property owned on a different planet, 32% of respondents actually felt homeowners actually think the value of their homes has increased, and another 17% percent feel that their home's value has not changed. Homeowners actually are consistent in their continued optimism, though the data shows some erosion. The Q2 study showed that 62% of respondents felt their home’s value had increased or stayed the same. In the West, homeowners were more realistic, with 65% saying their home’s value had declined and only 13% saying it had increased. Looking forward, 40% saw a decrease coming in the next 6 months, with 21% seeing an increase coming. When asked about their neighbor’s homes, people got realistic: 57% thought their neighbors’ homes would decline in the next 6 months, with only 18% saying their neighbor’s house would probably increase in value.