ST. PAUL
Twin Cities home values fell 15 percent in the first quarter from a year earlier to a median of $159,000. That's according to a Zillow report released today predicting that the housing market will bottom out next year at the earliest.
The Twin Cities first-quarter value fell more steeply than the nation overall. Nationally, home values fell 8 percent to $169,900 versus the year-ago period. The Zillow Home Value Index measures the value of all homes, not just those that sold in a particular period.
With substantial home value declines, as well as increasing negative equity and foreclosures, the online real estate evaluator Zillow now predicts the housing market won't bottom out this year.
"We did expect substantial payback from the homebuyer tax credits, which buoyed the housing market last year, but underlying demand post-tax credit, as well as rising foreclosures and high negative equity rates, make it almost certain that we won't see a bottom in home values until 2012 or later," said Stan Humphries, Zillow's chief economist, in a statement.
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The Zillow.com data is based on the values of all homes, not just those that have sold, and is aggregated from public information providers including recorded mortgages and other home loan data.
Home values in the United States fell faster in the first quarter of 2011 than they have in any quarter since 2008, when the housing market experienced its worst performance, Zillow reported.
Home values have fallen 30 percent since they peaked in June 2006.
In the first quarter, 46 percent of all Twin Cities single-family homes with mortgages were underwater compared to 42 percent in fourth quarter 2010 and 39 percent one year earlier. Nationally, the negative equity rate is 28 percent. A homeowner is in negative equity when they owe more on their mortgage than their home is worth.
About 41 percent of all Twin Cities homes sold in March went for a loss compared to 36 percent in December and 37 percent in March 2010. Nationally, 38 percent of all homes sold for a loss -- a new record.
In the Twin Cities, 25 percent of first-quarter homes sales were foreclosure sales, up 6.1 percentage points since the fourth quarter 2010. Nationally, foreclosure sales reached a new peak, representing 24 percent of all sales, compared to 17 percent a year earlier.
Distributed by McClatchy-Tribune Information Services.
