Did your home value decline this year? You’re not alone. Home values receded at a faster rate in the last quarter of 2011, but things may begin to slow down in 2012.
According to Zillow’s Home Value Forecast, U.S. home values declined faster during the fourth quarter than in the previous two quarters, falling 1.1 percent from Q3 to Q4. Home value overall fell a total of 4.7 percent through 2011.
The report, released Thursday, predicts homeowners will see their home value fall in December 2012, but home values will decline at a slower rate through the rest of the year. Zillow predicts home values in some markets will bottom out this year, but analysts predict values nationwide won’t hit bottom until 2013.
“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,” Humphries said in a statement. “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 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.”
According to the forecast, metropolitan statistical areas (MSAs) hardest hit by the housing bubble burst will likely hit bottom in 2012 and see some market stability, if not a small increase in prices. Those MSAs include Los Angeles and Riverside, Calif., Phoenix, Dallas, Denver, Miami, Tampa and Ft. Lauderdale, Fla., New York, Pittsburgh, San Diego and San Francisco.
The MSAs which stand to see the largest drops in home prices are Atlanta (-8.5 percent), Chicago, (-7.6 percent) and Seattle (6.9 percent). Cleveland and Sacramento could see prices drop roughly five-and-a-half percent.
In the fourth quarter of 2011, the foreclosure rate edged up slightly but was still lower than the rate at the end of the third quarter. Foreclosure re-sales made up just over 19 percent of all sales in December