Pretty bad, if you lived in Modesto and Vallejo, Calif. That’s where more than 80 percent of all homeowners owe more on their houses than they are worth.

That nugget comes, an online real estate marketplace that tracks home prices, national trends and the like. Its Zillow Home Value Index fell for the eighth consecutive quarter at the end of last year, declining 11.6 percent during 2008. Prices in Dallas, said Zillow, fell 4.1 percent, and almost 16 percent of homeowners in the Dallas area owe more than their property is worth.

I don’t know that Zillow is any more reliable than the S&P/Case-Shiller Index, whose total loss was 18.2 percent through November 2008. One key difference: Zillow tracks 161 markets, while Case-Shiller does the 20 largest. But I do know that neither is as accurate for the five neighborhoods where we publish as the Advocate Home Price Snapshot.

After the jump, a few more highlights from the Zillow report:
• One in five (19.9 percent) of all real estate transactions across the country in 2008 was a foreclosure. In the third quarter, 18.6 percent of all transactions were foreclosures.

• Almost 11 percent of all transactions in the United States in 2008 were short sales, or homes sales where the lender agreed to a home price less than the amount owed on the mortgage in order to avoid the cost and time of a foreclosure.

• More than one-third (34.6 percent) of homes sold in 2008 were sold for a loss, up from 30.2 percent for the previous 12 months.

• Home prices in Manhattan even decreased – 5.8 percent.

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