Nearly two-thirds (62 percent) of U.S. homeowners believe their home’s value has either increased or stayed the same in the past year, yet 77 percent of homes actually declined in value, according to Zillow.com’s latest homeowner confidence survey. Only 19 percent of home values increased and 5 percent stayed the same, the survey finds.
Still, homeowners’ outlook for the short term was even more optimistic. Three out of four homeowners (75 percent) expect their home to increase in value or stay the same over the next six months with 25 percent expecting a decline. However, that same level of optimism does not extend to neighbors’ homes, with 42 percent of homeowners’ expecting values in their local market to fall and 58 percent predicting that values will increase or stay the same. Also, 70 percent said they are concerned that foreclosures will decrease home values in their market within the next year.
The survey also finds that two-thirds (64 percent) of homeowners plan to invest in their home in the next six months. More than half (56 percent) are planning home improvements, 7 percent are planning to refinance, take out a home equity line of credit or get a second mortgage, and 7 percent are planning to buy or sell a primary or secondary residence. Homeowners who believe their home had increased in value were significantly more likely to plan major home improvements (22 percent) than those who believe their home values declined (14 percent).