Which areas have seen the largest drop in home prices?

Zillow has released its Q2 2011 Zillow® Real Estate Market Report looking at 154 metro areas across the nation.  In addition to year-over-year and quarter-over-quarter metrics, Zillow took a look at declines since the housing peak five years ago.  See Five Years After Housing Market Peak, Bumpy Road Toward Stabilization Underway As Home Values Show Recent Rise in Many Markets

So which areas have experienced the largest percentage drop in the last five years?  California cities have seen their home values drop by the largest percentage in the last five years, with some metro areas posting losses of up to 67 percent in that time period. In fact, California cities occupied seven of the top 10 metro areas with the largest drops (see table below).

And speaking of the “top 10”, I was pleased to see Reno, Nevada was not included in the top ten.  But, of course, my next question was just where did Reno place out of the 154 metros examined?  So, I pulled Zillow’s spreadsheet (See Zillow Home Value Index data) and sorted by a column showing the 5-year annualized Zillow Home Value Index for each of the metros.  Reno’s rank? …Eleventh place – with a negative14.7 percent annualized ZHVI over the past five years.

And for those readers who miss seeing Reno placed in a top-ten list, the following table shows the ten metro areas with the largest year-over-year decline (as of 2Q 2011) in Zillow’s Home Value Index.  As you can see, Reno Nevada holds the #4 spot.

Source: Q2 2011 Zillow® Real Estate Market Reports

From the Zillow’s latest report: “…Zillow’s Chief Economist Dr. Stan Humphries continues to predict a true bottom in home values in 2012, at the earliest, because of factors like foreclosures, negative equity and fluctuations in demand for homes.”