Despite the severe, ongoing housing and mortgage crisis, the majority of U.S. homeowners don’t believe their properties have been negatively impacted, according to a new report from Zillow.
Nearly two-thirds (62 percent) of homeowners surveyed said they believed their homes either increased in value or stayed level over the past year, though Zillow statistics found that 77 percent of U.S. homes actually declined in value during that time.
“Whether it’s apathy, confusion or just plain denial, homeowners seem to believe the housing crisis affects every other home but “not my house,” underscoring a wide gap between homeowners’ inflated perception of their home values and the gloomy market reality,” the report said.
According to Zillow’s upcoming second quarter “Real Estate Market Reports,” just 19 percent of U.S. homes increased in value over the past year, while five percent stood unchanged.
Somewhat amusingly, Zillow has launched a “Home Value Misperception Index” that tracks homeowner’s sentiment versus actual home value change.
So far, those in the West seem to be most attuned to the situation, perhaps because the region experienced the most significant home price declines.
Homeowners in the South seem to be the most delusional, with nearly 50 percent of respondents believing their home has increased in value over the last 12 months.
Going forward, a whopping 75 percent of all homeowners surveyed feel their home will increase in value or remain unchanged over the next six months.
At the same time, about half of those surveyed believe values in their local housing market will drop, apparently all but their own.
Good luck getting that home equity line of credit…