New Data Suggests Buyer's Market Will Continue

If you are a Chicago real estate owner, this story is going to bite. If you are in the market to buy a home, however, this story will show you that the market is yours and will be for a while.
According to a recent Zillow real estate market report, U.S. home value declines in the first quarter of 2011 matched the worst of the housing recession, while households with negative equity reached new highs.
Sign with a house falling down a mountain U.S. home values in the first three months of this year fell 3 percent from the previous quarter to $169,600. That’s the largest quarter-over-quarter decline since 2008, when the housing market experienced its worst performance ever.
In Chicago, home values fell even more last quarter; 4.8 percent to $167,900.
The year-over-year change is worse here too. Nationwide, home prices fell 8.2 percent in the first quarter of 2011 compared to the same time last year.
In Chicago, year-over-year values fell 13.8 percent.
We beat the nation in households with negative equity too, as a record 28.4 percent of all U.S. single-family homeowners owed more on their mortgages than their homes were worth at the end of the first quarter of 2011.
In Chicago, that number was a whopping 45.7 percent. That beats the record set last quarter of 38.6 percent.
“Home value declines are currently equal to those we experienced during the darkest days of the housing recession,” said Zillow Chief Economist Dr. Stan Humphries. “With accelerating declines during the first quarter, it is unreasonable to expect home values to return to stability by the end of 2011.”
In all, 97 percent of the 132 U.S. markets that Zillow followed posted home-value declines last quarter. In fact, only three metropolitan areas marked home-value increases, and one of them was in Illinois.
*Champaign-Urbana, Illinois saw home values rise 0.8 percent
*Fort Myers, Florida saw values jump 2.4 percent
*Honolulu, Hawaii posted home-value increases of 0.3 percent.
“We did expect substantial payback from the homebuyer tax credits, which buoyed the housing market last year,” said Dr. Humphries, “but underlying demand post-tax credit, as well as rising foreclosures and high negative equity rates, make it almost certain that we won’t see a bottom in home values until 2012 or later.”
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