Zillow: More homeowners drowning in mortgage debt
Plummeting home values have left nearly one-third (28.9 percent) of all Americans under water on their mortgages in the first quarter of this year, according to a newly released report from Zillow, an online real estate information company.
That’s up from one-fifth, or 17.6 percent, who owed more on their mortgage than their property was worth in the fourth quarter.
The rate of homeowners who are upside down is slightly higher in the Miami-Fort Lauderdale market, where 29.3 percent owe more than their mortgage is worth.
Home values in the Miami-Fort Lauderdale market have fallen 23.7 percent, year-over-year, to $182,847. During the fourth quarter, home values fell 24.9 percent.
Homes in the Miami-Fort Lauderdale area lost $15.7 billion in value during the first quarter and a total of $107.6 billion in the last year.
Broken down, home values in Broward County fell 24.3 percent, year-over year, to $169,101, while values in Miami Dade County were down 25.2 percent, year-over-year, to $206,087.
In the Palm Beach County market, home values fell 23 percent, year-over-year, to $169,514.
Deerfield Beach-based real estate analyst Jack McCabe predicts prices will continue to drop an additional 10 percent to 15 percent, on average, in South Florida, with more homeowners becoming upside-down.
“It’s our estimate prices will hit bottom in the middle of next year, and then stay there for the next two years,” McCabe said, noting that prices in South Florida have fallen about 41 percent since their peak in November 2005.
Nationwide, foreclosures and short sales remained steady in the first quarter. About one-fifth, or 20.4 percent, of all transactions were foreclosures in the previous 12 months, compared with 19.9 percent in the fourth quarter. Short sales made up 11.9 percent of all transactions in the last 12 months, compared with 10.9 percent in the fourth quarter.
However, McCabe expects the rate of foreclosures in South Florida to skyrocket as toxic adjustable-rate mortgages reach their first-term change and more people become unemployed.
There have been some early signs of improvement in some of the harder-hit markets in California, where there have been smaller year-over-year declines.
“Slowing declines in select markets are a bright spot – or, at least, what passes for one, given current market conditions, said Stan Humphries, Zillow vice president of data and analytics, in a news release.
However, he added that we’re still many months away from the bottom and an even longer wait before there’s a meaningful recovery in home values.
Meantime, those who are thinking about selling their homes are still holding off until they see better evidence of an improved housing market, according to Zillow.
One-third of all U.S. homeowners said they would be at least somewhat likely to put their home up for sale in the next 12 months, if they saw signs of a recovery. Twelve percent said they would be “very likely” to put their home on the market, eight percent said they would be “likely” and 12 percent said “somewhat likely.”
McCabe said those who think they can sell generally have greater equity and smaller mortgages. But, for those who bought their homes at the peak of pricing “there is no hope for these people, McCabe said. “When they go to sell, they will have to turn in the keys and go into foreclosure.”
Yeah, The debt is a big problem for all , thanks a lot for the great news.
Super info! I
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