Ruth Mills Team
San Diego Realtor
San Diego News & Real Estate Blog
Third-Quarter Housing Report Provides Some Optimism
Real estate data provider Zillow issued its third quarter Real Estate Market Reports earlier this week, which included a batch of bad news in terms of US home values, but deeper inspection of the report unveils a few glimmers of hope for the struggling US housing market. The report showed a 0.2 percent decline in home values between the second and third quarters, and a 4 percent decline on a year-to-year basis. While any decline in values translates to more underwater homeowners, the decline was far less severe than the 12 percent dip in prices between 2008 and 2009.
Stan Humphries, Zillow's chief economist, expects prices to continue to fall into next year, at least, citing an abundance of homeowners with negative equity and high unemployment as the main factors preventing the market from stabilizing. Even so, Zillow's third-quarter report does indicate a few trends that should offer some hope for the beleaguered real estate sector.
For one, there are less homes being seized by banks, meaning less distressed properties hitting the market, and the less impact they'll have on prices. It remains to be seen if this decline in foreclosures is because homeowners are catching up or if banks are still holding off on seizures to prevent flooding the market, but the positive effect will be felt either way.
Another positive trend is that some of the areas that were hardest hit by plunging home values during the housing crisis have started to rebound. Michigan cities Detroit, Grand Rapids and Ann Arbor each saw prices plummet during the downturn, and all have seen prices rebound for two straight quarters. Since economist project that the hardest hit areas will be the first to recover, news that these areas bodes well for the overall market moving forward.