Despite everything, homeowners still dreaming of big returns
Here's a scary number. As many as 42 percent of homeowners across the country think prices typically rise about 7 percent a year, according to a new survey by Zillow.
Of course, the real number is much lower, on average 2-5 percent a year. And of course, that's an historic average with the ups and downs of the market smoothed out.
The last time I checked - just this morning actually - we are still locked in a historic downturn that has seen home values fall as much as 30 percent or more in some markets.
Here's a good quote from Zillow's chief economist.
"It's troubling that we're still in the midst of one of the worst housing recessions in history, and yet prospective buyers continue to have such high expectations for home value appreciation," said Dr. Stan Humphries, chief economist at Zillow. "Over-estimation of the appreciation potential will lead many to buy real estate when the time in which they plan to live in the house may make renting a better strategy."
Enough is enough. It's time for homeowners to get with reality here. A house is a place to live, not a hot stock that you flip after three years for a 21 percent gain.
