Are Home Owners Being Realistic?

A new survey by zillow.com, an online real estate services company, shows that 81% of those polled believe that their house will not decline in value over the next 6 months:

"homeowners are more optimistic than ever about the future values of their homes, with 81 percent of homeowners believing their own homes' values will not decline in the next six months - the highest percentage on record since the first quarterly Homeowner Confidence Survey, which was fielded in the second quarter of 2008."

Things That Make You Go "hmmmm"

Clearly homeowners still have their heads in the sand and are either unwilling to look at the facts of the marketplace or they are being misled by the flurry of positive data-spin and perception management being proliferated by Wall Street, the National Association of Homebuilders, the National Association of Realtors and the Government ("trust me, jump on in - the water is perfect").

For anyone who is hesitant about the future direction of housing prices, please refer to this post of mine from a few weeks ago:

Housing Values: Look Out Belowwww

The other factor lending slight support to the mid-price range of homes right now is the $8k taxpayer subsidization of first time homebuyers down payments (the FHA now lets a home buyer apply the $8k tax credit to the down payment). Let's see what happens to home prices if Obama takes away this wealth transfer payment...