Sellers more likely to overprice their homes if they bought it post-bubble

Research conducted by Zillow found current home sellers who bought their home in 2007 or later overprice their home by an average of 14.1 percent.

Sellers who purchased their homes before 2002 are overpricing their home by 11.6 percent above market value, and sellers who bought between 2002 and 2006 are overpricing by 9.3 percent. Zillow economist Dr. Stan Humphries said that post-bubble buyers are overpricing because they avoided the worst of the recession, but sellers need to be realistic.

"Overpricing homes causes them to stagnate on the market and keeps inventory from decreasing- not a desirable outcome for either the sellers or the market as a whole," Humphries said.

Zillow also found that 17 percent of homeowners planning to sell in the next four years and purchased post-bubble said the purchase price would determine their asking price, despite home values currently down 30 percent from 2006.

According to the National Association of Realtors, existing home sales in May 2011 were 15.3 percent lower than May 2010, and the national median existing-home price for all housing types in May 2011 was down 4.6 percent from the previous year. Single-family home sales declined 15.4 percent in 2011 from 2010, and condominium and co-op sales fell 14.7 percent from last year.  

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