According to Reuters News nearly 20 percent of home owners owe more on their homes than their properties are worth, finds a new study by First American CoreLogic.

About 8.31 million properties were underwater at the end of 2008, up 9 percent from 7.63 million at the end of September.

Corelogic predicts about 2.16 million properties will be underwater if home prices fall another 5 percent.

The problem is the worst in Arizona, California, Florida, Georgia, Michigan, Nevada, and Ohio.

Nationwide, 68 percent of U.S. adults own their own homes, and about two-thirds have mortgages.

According to the National Association of Home Builders’ Consumer Preferences survey, these are the features most in demand among today’s buyers.

Top 5 Kitchen Features

1. Walk in pantry: 86 percent
2. Island work area: 80 percent
3. Special use storage (custom made for appliances): 66 percent
4. Built-in microwave: 72 percent
5. Drinking water filtration: 69 percent

Top 5 Bathroom Features

1. Linen closet: 89 percent
2. Exhaust fan: 88 percent
3. Separate shower enclosure: 79 percent
4. Water temperature control: 79 percent
5. Whirlpool tub: 66 percent

Top 5 Specialty Areas

1. Laundry room: 92 percent
2. Dining room: 81 percent
3. Home office: 71 percent
4. Den/library: 63 percent
5. Sun room: 53 percent

Top 5 Decorative Features

1. Ceiling fan: 83 percent
2. Built-in shelving: 70 percent
3. Window seats: 51 percent
4. Woodburning fireplace: 48 percent
5. Gas fireplace: 48 percent

Top 5 Community Features Preferred

1. Walking/jogging trails: 49 percent
2. Park area: 46 percent
3. Outdoor swimming pool: 39 percent
4. Lake: 34 percent
5. Playgrounds: 32 percent

The British Columbia Real Estate Association reported today that the decline in real estate markets didn’t just affect the Lower Mainland phenomenon in 2008 as the province as a whole saw sales drop by one-third .

Realtors recorded 68,923 sales across B.C. through the Multiple Listing Service, their lowest level since 2000, the BCREA said, when the province recorded 54,179 sales.

The average home price over the 12 months of 2008 was $454,599, a 3.5-per-cent increase from 2007.

BCREA chief economist Cameron Muir said the average price peaked in March at $483,291, and fell 11 per cent to $429,210 in December.  And that $429,210 average is six per cent lower than the average price in December, 2007.

According to an article published by RISMedia, there are nine real estate trends to watch this year. While specific to the Chicago market I think they are common to many cities in North America.

1. Less, With More. Single-family homebuilders are predicting the continued movement toward smaller homes, with many buyers opting for less square footage as a means of saving more, said Jim Chittaro, chief financial officer for Naperville-based J. Lawrence Homes. “Rather than paying more for square footage, they’re taking inventory of how much home they really need and deciding to go with a “quality over quantity” approach and adding features like a spa bath or gourmet kitchen that they’ll enjoy for years to come.”
2. The New American Dream. Homeownership has long been considered one of life’s benchmarks, so much so, that the concept earned the moniker, “The American Dream.” However, in today’s economic climate, realizing that dream is no longer an option for many people.
3. Urban Suburban. For years, a new-construction home in the suburbs meant moving into a cookie-cutter subdivision. But according to many suburban developers, their focus going forward won’t be simply building homes, but entire downtowns complete with residential, retail, restaurants and more.
4. Condo-MAX-iums. According to the National Association of Homebuilders, the average single-family home is 2,456 square feet. However, Chicagoland’s developers have noticed buyers – from young families to downsizers – are looking for the same amount of square feet when buying a condominium. “What we’re finding is that downsizers don’t really want to downsize at all. They’re accustomed to the design of a single-family home and don’t want to sacrifice space,” said Bob Horner, co-principal of Winthrop Properties. “Rather, they seek the maintenance-free lifestyle and single-level living offered by a condo.”
5. Online Toolboxes. According to the 2007 National Association of Realtors Profile of Home Buyers and Sellers, 84% of buyers use the Internet to search for a new home. Taking a cue from these findings, leading Chicagoland residential brokerage firms will be taking their services a step further by enhancing their sites with user-friendly Web tools that do much more than list homes for sale.
6. Common Ground. In the city, where green space is as high in demand as a parking space, some developers will start going the extra “yard” to give Chicagoans more outdoor community spaces.
7. The Sure Thing. With the real estate market in turmoil, buyers will be betting on the sure thing, said Ibrahim Shihadeh, co-principal of Winthrop Properties, developer of Printers Corner in the South Loop. “With our building complete and immediate move-ins available, sales momentum has been strong,” he said. “We’re one of the few buildings in the area ready for move-in. Until things smooth out a bit, buyers will continue to opt for developments that are complete or nearly complete rather than risk something that won’t come to fruition or won’t be as it was promised.”
8. The Resurgence of Rowhomes. Dating back to colonial Philadelphia and Boston, the rowhome is a hallmark of traditional city living. But at Port Clinton Place, a new-construction for-sale community in Vernon Hills developed by Opus North, and the Residences at the Grove, a 294-unit luxury rental community in Downers Grove, managed by RMK, even suburban residents will be enjoying the urban flavor of this classic housing style. “Rowhomes were born out of practicality, as their shared walls made it possible to fit more homes in densely-populated urban areas. But today, many suburban buyers are choosing these homes for their urban style and overall aesthetic appeal,” said Andrew Lockwood, real estate director for Opus North. “It’s a housing style that’s particularly appropriate at Port Clinton Place, which is part of a redevelopment plan to revitalize downtown Vernon Hills. Eventually this area will be a lively town center, much like the city neighborhoods where rowhomes first became popular.”
9. Creating Community. Many developers today are taking strides to form a sense of community among new residents before their homes are built – a trend that is expected to continue into 2009.

According to analysis of recent Zillow Real Estate Market Reports, home values declined 8.4% year-over-year during the first three quarters of this year, compared to the same period in 2007.

U.S. home values lost $1.9 trillion from the first of the year through the end of the third quarter, and were likely to fall further in the fourth quarter, leaving approximately 11.7 million American households owing more on their mortgage than their homes are worth. One in seven of all homeowners (14.3%) were underwater by the end of the third quarter.