Real Estate & Area News
Decline In Underwater Homeowners to Slow?
A report issued this week by housing data tracker RealtyTrac suggests that the millions of Americans who owe more on their mortgage than their home is worth may have to wait until 2015 before their situation is corrected. That's because the recovery in home prices we've enjoyed over the lats two years is expected to slow, according to the report. Of course, the number of so-called “underwater” borrowers has slipped substantially since peaking during the second quarter of 2012, but there are still more than 9 million homeowners considered seriously underwater, meaning their outstanding mortgage debt is at least 125 percent of their home's value. If RealtyTrac is correct, and price gains continue to slow moving forward, that number is not likely to come down much.
Like everything else in real estate, location plays a huge role in the percentage of homeowners underwater. While fairly broadly based, the recovery has happened at different speeds in different parts of the country. A handful of markets across the country, in fact, have seen prices reach their highest levels ever in recent months. These communities have significantly lower underwater rates, consequently. The San Francisco market is a prime example, as only four percent of homes with an outstanding mortgage are underwater. Markets where prices have not recovered as much, meanwhile, are still suffering underwater rates of 20, 30 or even 40 percent in some cases.
Among the states, Nevada continues to suffer the highest percentage of seriously underwater homeowners, with nearly 35 percent of mortgage holders in the state owning homes worth less than 80 percent of their loans. 31 percent of mortgage holders are seriously underwater in Florida, 30 percent are in that boat in Illinois and 29 percent of Michigan homeowners with a mortgage suffer the dilemma. The highest underwater rates among cities, meanwhile, can be found in Las Vegas (37%), Lakeland, Florida (36%) , Palm Bay/Melbourne/Titusville, Florida (35%) and Cleveland, Ohio (35%).
April 18, 2014