From the Housing Wire:
U.S. homes are set to lose well over $2 trillion in value during 2008, according to analysis of recent Zillow Real Estate Market Reports, leaving approximately 11.7 million American households owing more on their mortgage than their homes are worth.
U.S. home values declined 8.4 percent year-over-year during the first three quarters of this year, as $1.9 trillion in home value was lost, said Zillow, a Seattle-based provider of real estate data, in a study released Monday. “And those values are likely to fall further in the fourth quarter.”
“This year marked the acceleration of the market correction, and is likely to end with the eighth consecutive quarter of declines in home values,” said Dr. Stan Humphries, Zillow’s vice president of data and analytics. “In general, homeowners in most areas we cover are struggling with foreclosures pouring into the market, large amounts of negative equity and dropping home values.”
The Stockton, Calif. region fared the worst in the first three quarters of 2008, according to the report, with home values sliding 32.3 percent year-over-year. The Merced, Calif. area followed with home values declining 31.2 percent year-over-year.
Thirty of the 163 metropolitan statistical areas covered in the reports, however, showed gains in home value, or median value of all homes in the area over the first three quarters, with the Jacksonville, N.C. region seeing year-over-year appreciation of 4.9 percent.
Some markets — particularly those hit hardest in the downturn — showed smaller year-over-year declines in the third quarter. “Our optimism here, though, must be tempered by the knowledge that the larger economic problems that emerged in the fourth quarter will likely further challenge the real estate market,” Zillow said.
The fourth quarter brought record job losses — with initial jobless claims reaching 573,000, the highest since 1982 — a continued foreclosure frenzy and the declaration of a national recession; all of which don’t fare well for optimism, unfortunately.