Data released from Zillow’s second quarter Real Estate Market Report shows that American homeowners are much more realistic about their own homes’ values than they were one year ago, but are more optimistic about the future than at any other time in the past year.

Homeowners’ relatively more realistic perceptions of home values over the last 12 months resulted in a Zillow Home Value Misperception Index(ii) of 13 (an Index value of zero would mean homeowners’ perceptions were in line with reality), down significantly from a Misperception Index of 32 one year ago.

Although homeowner perception in the second quarter shifted closer to reality when compared to 12 months ago, the Misperception Index rose from six in the first quarter. In both Q1 and Q2, 60 percent of homeowners said their home had declined in value over the past year. But with 83 percent of homes actually losing value in the second quarter compared with 81 percent in the first quarter, the gap between perception and reality increased.

Other notes from the results:

• Sixty percent of all homeowners believe their own home lost value over the past 12 months; in reality 83 percent of U.S. homes declined in value.
• Eighty-one percent of homeowners believe their own homes’ values will not decline over the next six months.
• Homeowners in the South are the least realistic about their own homes’ values, while homeowners in the West are the most realistic

Below a graph which shows homeowner perception of future home values across the country.

Optimism Grips Homeowners: 81% Think Home’s Value Will Increase or Stay Same in Next 6 Months, But More Than Half Believe Home’s Value Decreased in Past Year