Could it be? Home prices actually stabilized this past year?
Apparently so, says a new analysis just out from Zillow Real Estate Market Reports.
The report says that prices, in fact, stabilized in 2009—but not before losing “trillions of dollars in value” in 2008.
Even better news this holiday season, according to Zillow: about one in three markets surveyed showed gains in the value of homes.
But don’t go reaching for that egg nog just yet.
Zillow’s chief economist ( and he is certainly not alone on this one) fears that as mortgage rates go back up from some historic lows, and as the number of foreclosures continues to grow, “these factors will challenge the recent stabilization of homes prices,” he is quoted by Reuters as saying.
So, we now know what the years 2008 and 2009 meant for home prices. If only we could predict with any degree of certainty what 2010 will mean for them!
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Article Author:
Charles FeldmanCharles has written 174 articles for us.
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Charles is currently reporting for KNX Radio in Los Angeles, is the co-author of the book No Time To Think, and can be found commenting about the news on his blog, The Feldman Blog, as well as on The Huffington Post.
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{ 4 comments… read them below or add one }
Uh, no. It’s 2009: The Year the Home Buyer Tax Credit Was Introduced. The price “stabilization” was just the result of people being tricked into rushing to grab a free $8,000 which they were told would expire otherwise. No way this lasts.
In my martket the first Time Home Buyer Tax Credit had little to do with prices stabilizing. The biggest impact came from the fact the inventory levels of single family detached homes are only at 40% of where they were in 2008. In addition sales are up because the low inventory and very low interest rates have created a sense of urgency with buyers at the low to mid price points. I agree that if interest rates have a substantial increase or if we see a glut of foreclosures hit the market we may see prices start declining.
Bob´s last blog ..Slight Drop in Active Inventory of Danville Real Estate
I’m not impressed with Zillow. I get updates on my house every month from Zillow and their estimate is based on sales of all types of houses around mine. They lump single family detached houses with townhouses like mine.
With ARMs about to reset, pushing more homeowners into forclosure and/or bankruptcy and credit still being tight, it will be more of a renter’s market. House values will probably drop (similar to the last wave of foreclosures) and because of increased demand, rents will probably go up.
I find Zillow’s report surprising!
The information that we are getting in Canada for the most part is that home prices are definitely not stabilizing in the U.S.
In fact on the contrary. Most info that I read is that there is still a significant wave of foreclosures yet to come, and that there is still going to be a significant negative impact in values for the short to medium term.
I did not read Zillow’s report, however, I would be interested to hear from other readers if the Cities that they live in experienced any gains in value recently.
Best Regards,
Neil.
Neil Uttamsingh´s last blog ..The Evolution of a Real Estate Investor – Part Two