Home values may have plummeted in the past year, but prices are still significantly out of line with apartment rents, according to a new study.

The average monthly cost of owning a home in the Valley is roughly $1,532, compared with $862 for a two-bedroom apartment or $1,256 for a three-bedroom, a study by the Center for Economic and Policy Research shows.

The trend is similar in other major metropolitan areas across the country, including Las Vegas, and has resulted in increased demand for rental housing.

In the past year, the number of renter households nationwide jumped by nearly 1 million, compared with an increase of 139,000 in homeowner households, according to the center’s study.

Despite the major shift in demand, however, the growth in Phoenix rental rates has slowed considerably.

That’s mainly because the increased demand has been matched by a growing supply of houses for rent by desperate sellers and investors. Developers are also turning failed condominium conversion projects back into apartments.

The result: More landlords are offering concessions these days, the most popular of which is a month’s free rent, so now may be the time for renters to lock in rates.

Here’s the good news: Valley home builders and real estate agents have been reporting more interest from buyers since the beginning of the year.

The bad news is that the increased activity isn’t necessarily translating into actual sales.

So why aren’t buyers actually biting?

Some are still waiting for prices to drop lower. Others harbor worries about the health of the national economy. And experts say tightened lending standards have also made it difficult for many people to qualify for financing.

Still, many industry professionals I’ve talked, along with some national groups, are  optimistic that the market will start to come around or at least level off by the end of 2008.

The National Association of Realtors said it expects to see sales begin to improve over the summer. The industry group also estimates sales of existing homes will total 5.39 million this year, then rise 6.1 percent to 5.72 million next year.

A new survey of homeowner confidence shows many Americans may be out-of-touch with reality.

Some 72 percent of homeowners recently surveyed believe their home’s value has gone up or stayed the same in the past year, according to Zillow.com.

But in reality, 75 percent of homes nationwide declined in value in the past year, the real estate Web site reported. Nearly 1,600 adults were surveyed by Harris Interactive for the Zillow study.

Home values in the first quarter 2008 were also down 7.7 percent from the same period a year ago — the largest year-over-year decline in more than a decade, according to Zillow.

“While we assume there’s a fair bit of owner denial reflected in these results, we also believe a large portion of the population simply isn’t paying close attention to their housing market because they’re not currently looking to sell or refinance,” said Stan Humphries, Zillow’s vice president of data and analytics.

The number of pending foreclosures in the Valley climbed to 20,407 in April — up from 5,385 reported at the same time last year, according to a recent study.

Some 6,143 properties received notices of foreclosure last month alone and another 2,968 were actually foreclosed on, according to Valley research company Information Market.

Tom Ruff, a partner in the firm, said that foreclosures could peak in the third quarter of this year, but whether things settle down by then is anybody’s guess.