What are they thinking in the West ?

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Every three months, the real estate information website Zillow.com produces a national homeowner survey that puts some numbers behind trends that are quite obvious to anyone shopping for a home or otherwise following the housing market.

For instance, homeowners nationwide are slowly accepting that their houses have lost value in the last year -- 57% said so in the latest survey, which covered the fourth quarter of 2008, compared with 51% in the third quarter. In fact, Zillow estimates, 76% of U.S. homes declined in value in 2008.

In the West, 70% of homeowners thought their home had declined in value in 2008, Zillow found. But Zillow figures as many as 90% of homes in the region (which extends from the West Coast to the Rocky Mountain states and includes Hawaii and Alaska) lost value last year.

At the end of the third quarter, 65% of western homeowners had thought their home lost value in the previous 12 months. So westerners are coming to terms with the decline in their home values.

But looking ahead, the Zillow survey found a surprisingly sunny outlook. Fully 25% of homeowners in the West thought their home will increase in value within six months. That’s up from 14% in the third quarter who had such high hopes for their home.

-- Peter Y. Hong