Homeowner confidence in U.S. market drops

Homeowners are more pessimistic about the short-term future of home values in their local market than they have been in the past three quarters, according to the Zillow.com second-quarter homeowner confidence survey. One-third believe home values in their local housing market have not yet reached a bottom, while 38 percent believe they have already reached a bottom. More than one quarter — 28 percent — of U.S. homeowners said home values will decrease in the next six months, up from 20 percent in the first quarter. Additionally, 30 percent believe home values will increase, down from 42 percent in the first quarter. “As homeowners have been so inundated recently with news of declining home sales post-tax credit, it’s no surprise that they would become more pessimistic about the future of home values,” said Stan Humphries, chief economist at Zillow. “Homeowners have become much more responsive to current market conditions than they were just two years ago, when a more typical reaction was denial.” TRD