Home values fell nationwide for the 17th straight quarter in the third quarter, according to a report from property valuation site Zillow.
Zillow’s Home Value Index, which tracks median home values in 440 metropolitan statistical areas across the country, fell 4.3 percent compared to the third quarter of 2009 and 1.2 percent compared to the second quarter, to $179,900.
That’s a 25 percent drop from the market’s peak in June 2006 when the index stood at $239,765. That compares with a 25.9 percent drop in home values in the five years between 1929-33, according to "Irrational Exuberance" by Robert J. Shiller (of the Case-Shiller Home Price Index), Zillow said.
"While not unexpected, the unceasing declines in home values signal that we’re in for a long, bleak winter of continued troubles for the housing market," said Stan Humphries, Zillow’s chief economist, in a statement. "The length and depth of the current housing recession is rivaling the Great Depression’s real estate downturn, and, with encouraging signs fading, will easily eclipse it in the coming months."
The share of single-family homeowners who owed more on the mortgage than the property was worth reached a new peak in the third quarter: 23.2 percent. That’s an increase from an upwardly revised 22.5 percent in the second quarter and a downwardly revised 22.2 percent in the first quarter. Zillow began tracking negative equity in second-quarter 2009.
"The high percentage of homeowners in negative equity continues to be troubling, in that it represents a huge number of people who are not only more vulnerable to foreclosure, but who are essentially trapped in their current homes and are prevented from selling and buying a new home," Humphries said. "This has profound implications for future demand and will be a millstone around the neck of the housing market."
Eleven of 145 selected metro areas had negative equity rates above 50 percent. Las Vegas and Phoenix lead the pack at 80.2 percent and 68.4 percent, respectively.
Home values fell quarter-to-quarter in 77 percent of markets tracked by Zillow. Some markets which had previously shown price stability declined again last quarter. These include five California metro areas that had previously seen five straight months of increases: Los Angeles, San Diego, San Francisco, San Jose and Ventura.
Among the largest 25 metro areas tracked by Zillow, home values in the Miami-Fort Lauderdale, Fla., metro area fell the most year-over-year (15.2 percent), and from its peak (down 53.3 percent, to $143,300). The Atlanta, Ga., metro area followed with a 13.2 percent year-over-year drop, to $134,200. Phoenix had the second-highest drop from its peak, down 53.1 percent, and the third-highest year-over-year drop, down 12.8 percent to $131,400.
Median list price fell 2.9 percent year-over-year, to $198,000. Median sale price rose 9.78 percent year-over-year to $207,600. The median sale-to-list-price ratio was 0.967, a 0.65 percent drop from the second quarter and a 0.36 percent drop from 2009’s third quarter.
Foreclosures reached a new record peak: 1.2 out of every 1,000 homeowners lost their homes. Sales of homes previously foreclosed on in the past year made up 20.1 percent of all home sales in September — near the record 20.5 percent peak in March 2009, Zillow reported.
The number of homes sold for a loss also reached a near-record high: 27.3 percent. The peak was in February 2010 at 27.7 percent.
| Largest 25 metro areas covered by Zillow | Home Value Index (Q3 2010) | Pct. chg quarter-to-quarter | Pct. chg year-over-year | Chg from peak | Negative equity (single-family homes) |
| United States | $179,900 | -1.2% | -4.3% | -25.0% | 23.2% |
| New York, N.Y. | $362,000 | -0.8% | -3.3% | -20.7% | 13.0% |
| Los Angeles, Calif. | $417,000 | -0.8% | 2.3% | -31.1% | 17.4% |
| Chicago, Ill. | $189,600 | -2.6% | -6.6% | -30.1% | 32.9% |
| Dallas, Texas | $131,300 | -2.1% | -1.8% | -8.4% | n/a |
| Philadelphia, Pa. | $203,400 | -1.7% | -3.1% | -13.5% | 14.2% |
| Miami-Fort Lauderdale, Fla. | $143,300 | -4.2% | -15.2% | -53.3% | 42.0% |
| Washington, D.C. | $316,500 | -2.6% | -3.1% | -27.3% | 23.6% |
| Atlanta, Ga. | $134,200 | -5.3% | -13.2% | -26.0% | 37.6% |
| Detroit, Mich. | $81,300 | -2.8% | -10.8% | -48.3% | 30.0% |
| Boston, Mass. | $328,600 | 0.1% | 1.6% | -17.5% | 9.5% |
| San Francisco, Calif. | $512,700 | -1.5% | 1.5% | -27.4% | 20.2% |
| Phoenix, Ariz. | $131,400 | -4.1% | -12.8% | -53.1% | 68.4% |
| Riverside, Calif. | $193,300 | 0.0% | 0.9% | -52.0% | 48.1% |
| Seattle, Wash. | $273,500 | -4.3% | -10.6% | -28.2% | 27.7% |
| Minneapolis-St. Paul, Minn. | $177,200 | -3.5% | -7.8% | -28.2% | 36.8% |
| San Diego, Calif. | $370,600 | -0.7% | 4.2% | -31.1% | 19.6% |
| St. Louis, Mo. | $138,100 | -2.4% | -3.4% | -12.3% | 22.2% |
| Tampa, Fla. | $115,700 | -1.9% | -9.1% | -46.3% | 46.8% |
| Baltimore, Md. | $231,800 | -2.7% | -8.6% | -22.2% | 20.8% |
| Denver, Colo. | $206,100 | -2.6% | -2.7% | -11.4% | 34.6% |
| Pittsburgh, Pa. | $110,300 | 2.6% | 1.6% | -1.4% | 6.3% |
| Portland, Ore. | $223,500 | -2.6% | -9.1% | -24.3% | 25.2% |
| Cleveland, Ohio | $118,500 | -1.0% | -2.4% | -17.7% | 33.0% |
| Sacramento, Calif. | $227,500 | -2.1% | -3.2% | -44.9% | 39.6% |
| Orlando, Fla. | $123,400 | -1.9% | -11.9% | -52.1% | 64.2% |
(Source: Zillow)
