Homes in the Boston area lost an estimated $9.5 billion in value collectively in 2011, actually marking an improvement over 2010’s $9.9 billion loss in values, according to a new report from real estate website Zillow.com.
Homes nationwide are expected to have lost more than $681 billion in value during 2011 – 35 percent less than the $1.1 trillion lost in 2010, according to Zillow’s analysis. The bulk of the total value lost during 2011 was in the first half of the year. From January to June, the U.S. housing market lost $454 billion. From July to December, Zillow projects residential home value losses will total $227 billion.
Regionally, only nine of 128 markets studied showed gains in home values during 2011, with the New Orleans metropolitan statistical area (MSA) showing the largest gain of $3.5 billion. The Pittsburgh MSA was second on the list, with a gain of $2.7 billion.
"While homeowners suffered through another year of steep losses, the good news is that homes are losing value at a substantially slower pace as the market works its way towards the bottom," Zillow Chief Economist Stan Humphries said in a statement. "Compared to last year when we saw sharp declines following the expiration of the homebuyer tax credits, this year we saw some organic improvement in home values, in terms of a slowed depreciation rate which resulted in a smaller total value loss for the year. Unfortunately, when we look ahead to next year, the unabsorbed pool of housing supply, dragging levels of consumer confidence, high unemployment and negative equity will continue to put downward pressure on the housing market, pushing our expectation for a potential recovery into late 2012 or early 2013."
Total home value change is calculated by subtracting the value of all homes in an area in December 2011 from the total value at the start of 2011, Zillow said in a statement. Total home values are calculated as the average of all Zestimate values multiplied by the total number of homes for a given day. Zestimate values are estimated values of individual homes, calculated with a proprietary Zillow formula. Forecasting was used to calculate value change during December 2011.
