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Unfortunately, a Bleak Winter Ahead for the Housing Market: Zillow Q3 Real Estate Market Reports

Date:November 9, 2010 | Author:Katie Curnutte | Category:Market Trends

After some signs of hope last quarter, the Zillow Q3 Real Estate Market Reports brought some grim news. Nationally, home values continued to decline, and several local markets that had been showing strong signs of stabilization took a turn for the worse. A few key facts:

U.S. home values continued to decline in the third quarter, falling 4.3 percent year-over-year, and 1.2 percent quarter-over-quarter.
With home values 25 percent below their 2006 peak and 17 consecutive quarters of declines, the length and severity of the current downturn is unprecedented since the Great Depression.
Negative equity rose to 23.2 percent of single-family homes with mortgages, the highest it has been since Zillow began tracking it in the first quarter of 2009.
In five markets, all in California – Los Angeles, San Diego, San Francisco, San Jose and Ventura – home values turned negative quarter-over-quarter after five quarters of gains.
Foreclosures reached an all-time high at the end of the third quarter, with more than one out of every 1,000 homeowners losing their homes to foreclosure in September.

For a deeper look, check out Zillow Chief Economist Stan Humphries’ analysis on the Zillow Research page.

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Responses (11)

0 tweets 0 likes 11 comments

Buy Scentsy 12:05 AM - Nov 10,2010

This is great news for home buyers, but not so good for the economy.
Brad Officer 6:12 AM - Nov 10,2010

Too much inventory, declining demand with high unemployment, I’d say this is no surprise.

For those buying now, they have the best of everything: lower prices, rock bottom mortgage rates, and plenty of homes to choose from.

Brad Officer
Jacksonville Real Estate
Jon Herring 7:40 AM - Nov 10,2010

Zillow seems to be making a concerted effort to get prices in line with reality all at once. I’ve noticed that in this story they say we’ve had a 4.3% yoy decline in prices. I find it interesting that they’ve knocked down the prices on all three of my properties from 10%-25% in the last five months alone. I wouldn’t consider selling at the Zillow prices. I rent all three of the places, and if I could buy them again for what Zillow says they’re worth and rent them for what I’m renting them for, I’d be getting a killer return on my invesmment. I wish they’d figure out a way to smooth their data. When I see huge swings (in both directions) like that, it makes me question the validity of the information I’m getting.
Hayek 9:02 AM - Nov 10,2010

@Buy Scentsy -Bad news for the economy? Whose economy are you talking about?

If too many homes were built and now they must drop in price to clear, How is that situation occurring bad for the economy?

This is not the cause of a bad economy. This is the effect. The cause was people paying paying too much for housing, Should we maintain such a policy?
Dan Desmond 9:18 AM - Nov 10,2010

These are things that we as individual agents can’t control. What we can control is our expenses and it’s important to batten down the hatches. Continue a degree of marketing that works for you but remember–most of what is being pushed on you does not sell houses. There is a large industry that feeds off over 1.5 million agents trying to out do each other. Spend wisely!
tom coogan 1:03 AM - Nov 11,2010

ladies n gents,RE THE NYC 5 BOROUGHS,N NASSAU N SUFFOLK COUNTY, I T.C.,FROM AN EXAMINER,TO A # 1 SALESMAN AND NOW # 1 SALESMAN/CLOSER, 32 YRS IN BUIS,FROM SLOW TO BUSY,TO MODERATE BUSY,TO VERY VERY SLOW,1990=ISH,TO 94 ISH,TO A STEADY INCREASE UNTIL 9/11/01,BUT 4 TO 6 MONTHS LATER,THE MARKET EXPLODED THRU 07.08 N 09,,AKA 730 DAYS OF DENIAL N DEPRESSION,TO 2010,AN ACCEPTANCE OF THE SILENT DECADE FOLKS IS HERE,ENTERING OUR 4 TH YR.I HARE IT MORE THAN YOU DO,BEING INVOLVED WITH MAJOR DEVELOPMENT ALSO.I KNOW OVER 100 SUCCESSFULL BRILLIANT INVESTORS.COMMERCIAL WILL GET WORSE.THE NUMBERS DONT MAKE SENSE TO BUY.REMEMBER,IM YOUR TEAMMATE, BUT I KNOW THE DEAL.THOSE WITH MONEY CAN BUY,BUT I MEAN REAL MONEY.INSTEAD OF MY 500 DEALS GENERATED, ILL DO 50 THIS YR.IT SUCKS BIG TIME,BUT IVE HAD MY RUNS OF GREATNESS.WHAT ABOUT THE 30 ISH YR MEN GETTING LAYED OFF,LEFT N RIGHT HERE IN NYC.MY RETIREMENT PLANS CHANGED DUE TO BLDG LOAN DISASTER,BUT IM STILL AHEAD OF THE GAME,BUT DAYS ARE LONG AND MONTHS ARE LONGER AND THE MEDIA IS FULL OF FILTHY MOUTHWASH. L HOPE IM WRONG,BUT I HATE POMPOUS PEOPLE,SO,ILL SAY,IM RATHER SMART,N CAN FORSEE 2 YRS AHEAD,WHICH WILL BE DEAD.GOD BLESS YOU ALL,AS IM IN IT TO WIN IT,BUT EVEN IF IT CAME BACK,,YOUR PRES,NOT MINE HAS DESTROYED US TX WISE.HOW MANY OF YOU KNOW THAT IN 2014,ALL USA HOMES SOLD,THE SELLER WILL PAY,3.8%,AKA 4%,,IE.SELL AT 650,000, N WRITE UNCLE SAM,$26,000,ALLPART OF HUSSAIN OBAMAS HEALTH PLAN.IM NOT A S PALIN FAN,BUT SHE HAS MUCH MORE EXECUTIVE POWER THAN OBAMA,,WHO HAS BEEN ON THE GOLF COURSE 29 TIMES MIN,ALL ON SUNDAY AM S.FORGIVE ME PLEASE,BUT ITS,SOS WITH HIM,,,AKA,SAME OLD SH–.GOD WOOD THIS IRISHMEN BE PROUD SO HAVE COLIN POWELL AS MY PRESIDENT.IMAGINE YOUR PRESIDENT,BEING ON THE VIEWN TALK TV SHOWS.NOT VERY PRESIDENTIAL
Jim O'Sullivan 7:21 AM - Nov 11,2010

I second Jon Herring’s comment.Zillow’s estimate of my two proeperties are radically low. They don’t justify the rent I’m getting for them.
Bob Rubel 8:16 AM - Nov 11,2010

After reading the 6:12 comment as to how rosey it is for buyers, I will comment on that. I am retired and I own my own home. I have a daughter that has Epilepsy and she has been living with us for 7 years. We are getting older and need to be on our own. So we are looking at buying a small house in town were we live for our daughter to be close by where we are able to help her without much difficulty. So if anything happens to us she can be independent. So I apply for a Mortgage and find out that I have to put 20% down because it’s an investment. That’s not my reason for buying, if it wasn’t for my daughters situation I would never be doing it. But either way I am being punished. Now how about closing costs, I will be forced to pay 2 to 3 points as a penalty. So by the time I get finished buying a $60,000 little cottage my cash outlay will be in the range of $18,000. So yes there are good prices, the interest rates are low but the lousy banks are going to take you over the coals to give you the privilage of owning a second home. So that’s a big part as to why people are not buying. It’s not really worth it.
Reply to Bob Rubel 10:41 PM - Nov 11,2010

Bob:

Go down to your local government housing office on a slow Tuesday and find out if your daughter might be eligible for HUD housing help. People think that all HUD does is run ghetto housing projects, but they have a number of different programs, including a program that would allow your daughter, if qualified, to get a HUD voucher for housing and either use that to pay rent OR to pay a mortgage. If the first person you talk to at the housing office is unhelpful, go to an office in a different county and talk to somebody else. Also look at the HUD housing website on the internet.