Zillow: Home price depreciation to worsen market into 2011
Predictions for the fourth quarter housing market continue to dim as Zillow's third quarter market report released Wednesday suggests further house price depreciation through the end of the year. September home prices depreciated 0.4% from August and 4.3% from one year a go to a national average of $179,900, according to the report. This is the 17th consecutive quarter of home price declines. Zillow reported that nearly two-thirds (64.2%) of homes in the U.S. lost value between the third quarter of 2009 and the third quarter of 2010, and 27.3% of home sold in September were sold for a loss. On Tuesday Foresight Analytics said residential, commercial, and construction loan delinquencies are excepted to rise. Delaware witnessed the most home price depreciation since 2009, down 18.5% to $174,700 in September 2010. California's home prices appreciated since 2009, up 1.9% to $337,200. Approximately one in every 1,000 mortgaged homes in the U.S. was liquidated in September, according to Zillow, marking the highest liquidation rate the firm has recorded since it started tracking data in 1996. The firm sees the liquidation rate remaining elevated because of an increase in negative equity rates. According to the report, the negative equity rate during the third quarter was 23.2%, up from 22.5% in the second quarter. Foreclosure resales reached a near-peak level in September accounting for 20.1% of all sales made during the month. The peak percentage of sales attributable to foreclosure resales was in March 2009 at 20.5%. Zillow said the firm doesn't expect home prices to hit rock bottom until the first half of 2011, but concluded that "the length and severity of the current turndown is fast approaching the length and depth of the Depression-era." Zillow data is based on real-time mortgage quotes from lenders registered with the company. The third quarter report is available on their website and includes interactive charts and graphs broken down by state and by metropolitan statistical area. Write to Christine Ricciardi.