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Checking sellers' price perceptions

September 14, 2008|Mary Umberger | Chicago Tribune

Are homeowners in denial?

Are they stubbornly -- maybe irrationally -- clinging to the belief that other people's homes may be losing value, but theirs isn't? How else, one wonders, to explain sellers who cling fast to pre-housing slump notions in this wacko market?

Or are they getting it -- to the point where they understand we're in a brave new world of pricing?

I guess that depends on who's asking the question.

Zillow.com is in the "They're in denial" camp: It recently surveyed homeowners about how much their properties are worth. The home-valuation website said that nearly two-thirds believe that their homes' value has increased or at least stayed the same over the last year.

But Zillow says its data suggest otherwise -- that three-fourths of American homes lost value in the last 12 months.

Then, along comes another survey, this one by Reuters and the University of Michigan, which seemed to find a more sober mind-set.

Among homeowners the university surveyed in August, just less than half said their homes had declined in value during the last year -- twice the level recorded in August of last year and more than the previous record of 41% in July, Reuters reported.

The pollsters found that the negative outlook was much more pronounced in Western states, where prices have been swirling downward with particular drama.

Some dry land for Phelps

One of the first things swimmer Michael Phelps did after making his little splash at the Olympics was to buy a condo. It's a rather nice pad for a 23-year-old -- the lanky young man will have more than 4,000 square feet in which to spread out in his new loft in his hometown of Baltimore.

Price tag: $1.69 million, according to the New York Daily News. The unit, in a building on the city's waterfront, comes with a rooftop terrace, a screening room, a whirlpool tub and a gym. And, of course, there's a swimming pool.

But it won't be the only place he'll be able to do laps -- Phelps also has bought a swimming club and ice rink in Baltimore that he hopes to turn into an Olympic training facility.

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