RPT-US homeowner confidence varies by region in qtr-Zillow

(Repeats item run earlier)

NEW YORK Nov 18 (Reuters) - U.S. homeowner confidence varied significantly by region in the third quarter as home values in parts of the country stabilized while others saw declines, real estate website Zillow.com said on Wednesday.

Homeowners in the Northeast were the most cynical about their own homes' values over the past 12 months, although the region posted the highest percentage of homes increasing in value during that same time period, according to the Zillow Q3 Homeowner Confidence Survey and the Zillow Q3 Real Estate Market Reports.

One in five, or 20 percent, of Northeastern homeowners believes their own home gained value in the past 12 months, according to the survey.

But in reality, 31 percent of homes in the region increased in value, according to the reports.

That translates to a Zillow Home Value Misperception Index of negative 6, which means Northeastern homeowners believe values performed worse than they did in reality -- a first in Homeowner Confidence Survey history, which dates back to the second quarter of 2008. A Misperception Index of 0 would mean homeowners' perceptions were in line with reality.

"Homeowners are clearly confused about the housing market, and with good reason," Stan Humphries, Zillow chief economist, said in a statement.

"Home values in different parts of the country have shown varied performance in the third quarter," he said.

Homeowners in the West were the least realistic in the country, with 28 percent believing their own homes' values increased in the past 12 months. According to Zillow, 17 percent of homes in the region actually increased, resulting in a Misperception Index of 17.

The Midwest had an Misperception Index of 8, while the South had an index of 15.

Nationally, 25 percent of homeowners believe their own home's value increased in the last 12 months. In reality, 22 percent of U.S. homes gained value. But fewer than half, or 49 percent, believe their home's value decreased over the past 12 months, while 72 percent actually decreased. That discrepancy between perception and reality resulted in a Misperception Index of 10.

"Consistent with all previous surveys, homeowners also seem to be overly optimistic about future home values," Humphries said.

"While we have definitely seen some stabilization in recent months, there is a high likelihood that home values will see further declines driven by an increasing number of foreclosures coming into the market and, possibly, rising interest rates after the first quarter of next year," he said.

U.S. homeowners were more optimistic about the future of their own homes' values than at any time in the past six quarters. Two in five, or 41 percent, say their own home's value will increase in the next six months. An additional 43 percent say their home's value will remain the same, with only 17 percent saying their home's value will decrease, the survey showed.

"The home buyer tax credits have the potential to stimulate demand and bring about a bottom sooner but, even so, we are very likely to see a sustained period of negligible appreciation in real terms," he said.

"It seems that homeowners are still working under the assumption of a V-shaped recovery to home values when a long, L-shaped recovery is more likely," he said.

Meanwhile, pent-up supply, a component of shadow inventory, remained relatively steady in the third quarter, with 31 percent of homeowners saying they would be at least somewhat likely to put their home on the market with signs of a turnaround, the survey showed. (Reporting by Julie Haviv; Editing by Kenneth Barry)