SEATTLE -- Feb. 18, 2010 -- American homeowners' confidence in their own homes' values during the fourth quarter fell to the lowest level in seven quarters, with just one in five (20 percent) believing their own homes' values increased during 2009, according to the Zillow Q4 Homeowner Confidence Survey. In reality, 28 percent of homes increased in value during the year, according to Zillow's Fourth Quarter Real Estate Market Reports.

That resulted in a Zillow Home Value Misperception Index of negative two -- the closest to zero on record since Zillow introduced the index in the second quarter of 2008, when the index was at 32. A Misperception Index of zero would mean homeowners perceptions' were in line with actual values. A negative Misperception Index indicates that homeowners are overly cynical about their own homes' values when compared with reality. This is the first time the national index was negative.

Half of homeowners believe their own homes lost value during 2009, while 30 percent believed their homes' values stayed the same. In reality, 65 percent of homes lost value during the year, and values remained the same for 7 percent.

"Not My Home" Sentiment Fades as Homeowner Attitudes Shift

The results demonstrate the "not my home" sentiment that was once prominent among American homeowners has faded. One year ago, nearly half (47 percent) of homeowners believed values in their local market would decrease in the next six months. However, when asked about their own home, fewer than one in three (30 percent) believed their own home's value would decrease.