Sand Creek Plaza

Zillow.com the website now best known for delivering bad news to delusional home owners announced today homes values have slide for the 7th consecutive quarter down 9.7 percent in the third quarter of this year relative to their levels one year ago. This marks the seventh consecutive quarter of negative year-over-year declines, each quarter turning in a greater negative annual change than the prior quarter. For comparison, the revised second quarter annualized change in the Zillow Home Value Index was 8.6%. For the first time this quarter, the depth and duration of the housing downturn in some markets has translated into flat or negative five-year annualized appreciation rates. Twenty-seven of the 163 markets covered experienced negative five-year annualized value changes and another twelve markets had basically no change over that period of time. For example, Stockton real estate has dropped 3.8% on an annualized basis since 2003 and Boston home values have dropped about one percent annualized over the past five years. Some markets are now teetering on the edge of seeing no appreciation over the past decade such as Detroit where real estate values have increased less than one percent on an annualized basis over the last ten years.

It is essential that the supply of homes accumulated during this downturn is sold off fast. Sales volumes must pick up to a pace that exceeds the normal rate of sales to bring back this market. If we think of the inventory of unsold homes as a bucket of water, and the bucket already has a historically high level of water in it, if we keep pouring more water into it, the bucket is bound to spill over.

Tags: Home Sales, Zillow

This entry was posted on Wednesday, November 12th, 2008 at 8:32 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.