However, there may be more bad news for consumers, as home values are expected to fall more than $1.7 trillion this year, with more declines expected in 2011.
The bulk of this loss was seen in the second half of the year, according to analysis by Zillow Real Estate Market Reports. During the first six months of the year, the housing market lost $680 billion. The forecast for the latter half of the year looks worse, as home value losses are expected to top the $1 trillion mark from July to December.
“Government interventions like the homebuyer tax credit helped buoy the market during the second half of 2009 and the first half of 2010, but we saw a renewed downturn in the last half of this year,” said Zillow chief economist Stan Humphries. “It’s a testament to the nearly irresistible force of the overall market correction that government incentives can only temporarily hold back the tide.”
Despite this, some specific markets saw gains during the year, the report said. Both the Boston, Massachusetts, and San Diego, California, metropolitan areas posted more than $10 billion in increased home values.