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Homeowners True Believers: 77% Believe Their Homes Held or Increased Value in 2007; Despite Housing & Credit Market Turmoil, Many Homeowners to Renovate, Refinance and/or Sell

Zillow.comĀ® Survey Reveals Homeowner Denial or Inattention: Other Houses Lost Value, Not Mine

Feb 7, 2008

SEATTLE, Feb. 7 /PRNewswire/ -- Despite repeated highly publicized reports of a home sales slump and pricing slides, there's a surprising amount of positive consumer sentiment -- and perhaps a good measure of homeowner denial as well: Even in a negative home pricing environment, 77 percent of homeowners from around the country believe the value of their home has increased or remained the same in 2007, according to a recent survey conducted by Harris Interactive®.


What's more, sizable fractions of all homeowners -- not just those who believe their homes appreciated in 2007 -- say they are planning to do things in 2008 -- even before the Fed's latest interest rate cuts -- that you might not expect during the housing, construction and credit slumps:

  * 82 percent will spend the same or more on minor home improvements
       (install new garbage disposal, repaint or wallpaper a room)
  * 67 percent say they will spend the same or more on major home
       improvements (replace the roof, remodel the kitchen) this year
  * About a third say they are more likely or equally as likely to:
       o Take out a home equity loan (35%)
       o Refinance their mortgage or take out a second mortgage (36%)
       o Sell their homes (34%)

  How Bad it is in the Reality-Based World

The Zillow® Q3 Home Value Report says U.S. home values dropped 5.7 percent nationwide year over year (2007 to 2006). Zillow plans to release its Q4 report Feb. 12 and preliminary results indicate home values in most U.S. markets have continued their descent. In a recent report, Merrill Lynch predicted "housing prices will remain in free fall," declining 15 percent in 2008 and 10 percent in 2009, "with more depreciation likely beyond the forecast period," even if the Federal Reserve continues to cut interest rates.

How Homeowners Perceive the Situation

About a third of homeowners (36%) in the Home Value Survey said their homes had actually increased in value during 2007. Zillow's Zindex® data proves the contrary, showing median value declines across regions as of October 2007.

                                   Total  Northeast  Midwest   South    West
  My Home's Value Has Increased     36%      31%      39%       37%      36%
  My Home's Value Has Decreased     23%      22%      16%       21%      34%
  My Home's Value Has Stayed the
   Same                             41%      47%      44%       42%      30%
  Median  Year-over-Year Value
   Change                        -5.04%   -2.57%   -2.02%    -4.02%   -7.86%
  According to

  What's Driving Homeowner Perception?

"This survey reveals that despite the data to the contrary, people either aren't paying attention to their housing market or are in denial about their own home's value," said Dr. Stan Humphries, vice president of data & analytics. "This likely reflects the fact that most Americans have not realized home-related losses because they're staying in their homes. Even in declining markets where a greater percentage of new homeowners are underwater on their mortgage, it's important to remember most people are not really affected by declining values unless they absolutely must sell or need to immediately refinance or withdraw equity. This has contributed to the healthy investment intent, particularly in home upgrades, despite the downward trending markets."

How to Stay on Top of a Home's Value?

Zillow recently increased its database of homes with Zestimate valuations to 67 million, which equates to about three out of four U.S. homes. People can easily check a home's value by visiting and typing in an address.

Zillow Q4 Home Value Report Conference Call

Join Zillow's VP of Data and Analytics, Dr. Stan Humphries, on Tuesday, February 12th @ 11:00 AM PT to learn more about how markets nationwide fared in Q4 and what the results mean in the broader context of the real estate market. To join, dial toll free: 1.866.250.4375

About is an online real estate community where homeowners, buyers, sellers, and real estate agents and professionals find and share vital information about homes, for free. In addition to having data on more than 80 million homes, Zillow provides market valuation has details on more than 7,500 neighborhoods in 130 U.S. cities that includes demographic data on the types of people who live there and information about the local area., Zillow, and Zestimate are registered trademarks of Zillow, Inc.

*Methodology and Timeframe of the Survey

The Home Spending survey was conducted online by Harris Interactive within the United States on behalf of between December 26 and December 28, 2007, among 2,254 adults ages 18+, of whom 1,619 are homeowners. This online survey is not based on a probability sample and therefore no estimates of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables, please contact Sarah Mann ( or 206-470-7171).

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CONTACT: Sarah Mann of, +1-206-470-7171,

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