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HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!

 
Chris Jusset
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02/10/2011 05:06 AM

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HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
From CNN Money & Bloomberg:

-- 27% of homeowners with mortgages owe more than their homes are worth. That's up from 23.2% a quarter earlier. About 15.7 million homeowners had negative equity (i.e., were underwater), at the end of the year, up from 13.9 million in the previous three months.

-- Home prices dropped 2.6% nationwide during the last three months of 2010, pushing more borrowers underwater, according to a quarterly real estate market survey from Zillow.com.

-- More than one-third of all homes were sold at a loss in December. That trend has been on a steady uptick for the past six months, as homeowners try to find ways around foreclosure or out from under their homes.

-- Values will fall as much as 5 percent this year, putting more homeowners underwater.

-- The median value for a U.S. single-family home was $175,200 in the fourth quarter, down 2.6 percent from the end of September and 5.9 percent from a year earlier, according to Zillow. Values have fallen 27 percent from the June 2006 peak.

-- According to Stan Humphries, Zillow’s chief economist: “These seem like fairly grim numbers. We’re still expecting a bottom in home values later this year. And this, if anything, makes me a bit more confident because I’m seeing very large corrections now, which means the market can start to repair itself.”

[link to money.cnn.com]

[link to noir.bloomberg.com]
Chris Jusset (OP)

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02/10/2011 05:22 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
Related housing doom from Bloomberg:

Stiglitz Expects 2 Million U.S. Foreclosures This Year

Nobel Prize-winning economist Joseph Stiglitz said another 2 million foreclosures are expected in the U.S. this year, adding to the 7 million that have occurred since the economic crisis of 2008. “U.S. foreclosures are continuing apace,” Stiglitz told a conference near Port Louis, the capital of Mauritius, today. “A quarter of U.S. homes are underwater. Americans today are worse off than they were 10 to 12 years ago.” At the same time, the U.S. faces “increasing inequality”, with the “upper 1 percent controlling 40 percent of wealth. Instead of trickle down, it has trickled up.”

[link to noir.bloomberg.com]
Chris Jusset (OP)

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02/10/2011 05:43 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
More housing doom from ZeroHedge: "US Housing Continues Freefall & Is Nowhere Near The Bottom"

[link to www.zerohedge.com]

"The residential real estate situation is still looking quite bleak. The downturn ... has come, and come with a vengeance. ... Come 2011, the effects of the government’s attempt to usurp market forces have nearly completely worn off and housing stock is in free fall – exactly as I proclaimed in 2009 and 2010 – free fall in an incessant search for equilibrium. Said equilibrium is nowhere near where we are now. ... I believe things are actually going to get worse, for the shadow inventory buildup has been exacerbated by the foreclosure issues. ... Shadow inventory not only hides the true condition of the housing market, it allows banks to hide the true nature of profits from said housing stock."
AwakeAndAware

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02/10/2011 06:29 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
The "shadow inventory" that they refer to is the near 50% of homes that have already been foreclosed on that the banks have sat on and not put up for sale yet to keep housing prices from dropping another 20%. They can't continue to sit on them forever and when those houses are finally put on the market, housing prices will plummet.

It gets worse. As of January 2011, well over 5 million homeowners were 2 or more payments behind on their mortgage and that number is climbing faster than foreclosures can be made as food and gas prices continue to rise. That they "expect" 2 million foreclosures in 2011 is ludicris and just a fantasy as that would mean that over 3 million homeowners were able to catch up on their payments which history indicates absolutely will not happen. Bottom line, home prices could be as much as 40% lower by the end of the year than they are right now.
Chris Jusset (OP)

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02/10/2011 06:44 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
Bottom line, home prices could be as much as 40% lower by the end of the year than they are right now.
 Quoting: AwakeAndAware


MAJOR HOUSING DOOM!

If housing prices fall by double-digits in 2011, that will place a great deal more stress on banks, so we could expect to see many more BANK FAILURES as a result. BANK DOOM!

aloneabombahhh

At some point, this downward spiral of lowering prices and increased foreclosures will feed on itself, as underwater homeowners slash prices even more out of desperation.

aloneabombahhh
Chris Jusset (OP)

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02/10/2011 07:19 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
At some point, this downward spiral of lowering prices and increased foreclosures will feed on itself, as underwater homeowners slash prices even more out of desperation.

aloneabombahhh
 Quoting: Chris Jusset


Given that the housing market is the backbone of the US economy, it's hard to fathom how there can be a "recovery" when housing and unemployment are so atrocious.

This commentator agrees:

For two years, Americans have been told by politicians and bankers that there is a “U.S. economic recovery” underway. Two years ago, the U.S. housing market was in the worst shape it had ever been in, after a collapse more severe than the worst years of the Great Depression. And now after two years of a “recovery”, it's in even worse shape? Quite simply, one could spend their entire life scanning the annals of economic history, and would never find another example where a housing market which was already at a multi-decade bottom has deteriorated after two years of “an economic recovery”. There is no “U.S. economic recovery”. There never was a recovery. Rather than debate this obvious point, as the saying goes “a picture is worth a thousand words”.


Read more: [link to www.benzinga.com]
Anonymous Coward
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02/10/2011 07:33 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
I heard this information on housing too
I think we are in for a flood of houses that have not yet begun official foreclosure niceties or are just being foreclosed on.


I know that people tried to hold on to properties. Let's face it why pay $2,500 when rent is less than a grand

I also think that the quality of life will go down in the US as we rent more apartments. Not to say that apt living is sucky it's just cramped with no yard.

Another negative consequence of the foreclosures to come will be the flood of pets people will have to give up in order to move to rentals and apts that do not allow them. Sometimes they are the sad tragedy. Heck people get rid of a dog just because they move. I moved 2,400 miles AND took my 8 year old border collie mix for the 6 day car ride...

I think this is a great thread and the more money people are dishing out for food and gas as it increases, the less they are able to pay for too high mortgage payments

Good thread
Chris Jusset (OP)

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02/10/2011 07:56 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
I think this is a great thread and the more money people are dishing out for food and gas as it increases, the less they are able to pay for too high mortgage payments

Good thread
 Quoting: Anonymous Coward 1249965


Excellent point. With commodities soaring, there will be much less disposable income for paying mortgages. According to the Daily Mail (09 Feb 2011),

Corn has increased 92% year-on-year
Wheat has increased 80%
Coffee has increased 70%
Soy beans have increased 65%
Vegetable oil has increased 14%
Pigs have increased 26%
Cattle has increased 23%
Cotton futures have hit a fresh post-Civil War high

I predict that food and clothing prices will soar in 2011, and if oil/gas prices skyrocket (which many predict), this will further doom the housing market.
Chris Jusset (OP)

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02/10/2011 08:17 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
Another negative consequence of the foreclosures to come will be the flood of pets people will have to give up in order to move to rentals and apts that do not allow them. Sometimes they are the sad tragedy. Heck people get rid of a dog just because they move. I moved 2,400 miles AND took my 8 year old border collie mix for the 6 day car ride...
 Quoting: Anonymous Coward 1249965


I'm glad that you were able to keep your border collie. My cousin had to get rid of his coonhound after he got foreclosed on and moved to a rental property. Some rentals allow for small dogs, but larger dogs are much more difficult to find a home for.
Anonymous Coward
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02/10/2011 08:22 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
I think this is a great thread and the more money people are dishing out for food and gas as it increases, the less they are able to pay for too high mortgage payments

Good thread
 Quoting: Anonymous Coward 1249965


Excellent point. With commodities soaring, there will be much less disposable income for paying mortgages. According to the Daily Mail (09 Feb 2011),

Corn has increased 92% year-on-year
Wheat has increased 80%
Coffee has increased 70%
Soy beans have increased 65%
Vegetable oil has increased 14%
Pigs have increased 26%
Cattle has increased 23%
Cotton futures have hit a fresh post-Civil War high

I predict that food and clothing prices will soar in 2011, and if oil/gas prices skyrocket (which many predict), this will further doom the housing market.
 Quoting: Chris Jusset



What is this? A voice of reason on GLP?

You are spot on with that post btw. Less jobs (or jobs not adjusting cost of living) plus staple commodity inflation = trashed income. Back to the revolving lines of credit she goes.


Plus this year is the mortgage reset peak.

[link to bp3.blogger.com]
Jane SmithModerator
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02/10/2011 08:22 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
According to Stan Humphries, Zillow’s chief economist: “These seem like fairly grim numbers. We’re still expecting a bottom in home values later this year. And this, if anything, makes me a bit more confident because I’m seeing very large corrections now, which means the market can start to repair itself.”
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
We have been hearing this every year since 2006, but the market just never seems to bottom. It is my opinion that it will not bottom until this economy fully resets. There is much more economic pain ahead -- weel, except for those benefitting from the bailouts we all funded.
Life is karma and karma always reflects both past and present circumstance. Our time here is short, so choose carefully and behave well, for all of your tomorrows are presently being decided.

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Anonymous Coward
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02/10/2011 08:23 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
Australian House prices just go up and up..
Chris Jusset (OP)

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02/10/2011 08:54 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
I think this is a great thread and the more money people are dishing out for food and gas as it increases, the less they are able to pay for too high mortgage payments

Good thread
 Quoting: Anonymous Coward 1249965


Excellent point. With commodities soaring, there will be much less disposable income for paying mortgages. According to the Daily Mail (09 Feb 2011),

Corn has increased 92% year-on-year
Wheat has increased 80%
Coffee has increased 70%
Soy beans have increased 65%
Vegetable oil has increased 14%
Pigs have increased 26%
Cattle has increased 23%
Cotton futures have hit a fresh post-Civil War high

I predict that food and clothing prices will soar in 2011, and if oil/gas prices skyrocket (which many predict), this will further doom the housing market.
 Quoting: Chris Jusset



What is this? A voice of reason on GLP?

You are spot on with that post btw. Less jobs (or jobs not adjusting cost of living) plus staple commodity inflation = trashed income. Back to the revolving lines of credit she goes.


Plus this year is the mortgage reset peak.

[link to bp3.blogger.com]
 Quoting: Anonymous Coward 936917


Whoa ... I forgot about the mortgage resets for all of those adjustable rate mortgages. That 2011 peak in your link is some scary shit!
Anonymous Coward
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02/10/2011 08:59 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
I live in the suburbs of Chicago, everyone I know has lost a huge amount of equity in their homes

-home was worth $280k, now worth $121k

-bought home for $316, put over $100k into home, home is only worth $400k at refi

-and on and on.

Seems that the average loss of equity is around 30%-50$

It shows you just how propped up the housing market really was, how manipulated the market was. This is just another way for the banks to steal capital from the American people.
Chris Jusset (OP)

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02/10/2011 09:10 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
It shows you just how propped up the housing market really was, how manipulated the market was. This is just another way for the banks to steal capital from the American people.
 Quoting: Anonymous Coward 1204064


Exactly, everything fell into place to make this housing bubble as massive as possible, including the Fed's ultra-low interest rates; massive mortgage fraud; greedy bankers; willing home flippers; incompetent lawmakers; and lax law enforcement.

I live in the suburbs of Chicago, everyone I know has lost a huge amount of equity in their homes

-home was worth $280k, now worth $121k

-bought home for $316, put over $100k into home, home is only worth $400k at refi

-and on and on.

Seems that the average loss of equity is around 30%-50$
 Quoting: Anonymous Coward 1204064


Yep, Chicago ranked 10th in negative equity among the top 25 metro areas.

[link to news.medill.northwestern.edu]
DanG
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02/10/2011 09:12 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!


real live DOOOM

Anonymous Coward
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02/10/2011 09:18 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
Was at a seminar a week ago where in passing they mentioned the house sales data for last year for our medium size metro area that has NOT been listed as a stressed area in any publication. About 75% of the sales here last year were either foreclosures, short sales, or other sales made under financial duress.

The person making the comments also noted that based upon the number of loans that are several payments behind that foreclosure proceedings have NOT begun, this year should have a huge slug of distressed inventory also hitting the market, larger than last year. They expected local prices in our "strong" market area to overall drop another 10%, though the actual drops will be more or less depending upon neigborhood situations. (recent new build areas are being hammered ... even while the very best of the older middle class suburbs with great school districts are actually now climbing a bit)
The Spirit Of Truth

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02/10/2011 09:19 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
But if the Fed prints lots and lots of money, then the banks, hedge funds, etc., will make big bucks trading stocks and commodities amongst themselves and then those people will buy lots of houses for lots of money and everything will be OK.

Why would you question Helicopter Ben's genius to cure the world's ills by printing lots of money? He knows economics better than anyone!

/SARCASM
Jay
The Spirit Of Truth
[link to www.SpiritOfTruth.me]

TOPPING PATTERN COMPLETE? - [link to thespiritoftruth.blogspot.com]

RUSSIA WAS BEHIND 9/11: [link to thespiritoftruth.blogspot.com]
RUSSIA'S SECRET WAR PLANS: [link to thespiritoftruth.blogspot.com]
RUSSIA'S LYING TO THIS WORLD: [link to thespiritoftruth.blogspot.com]

And then the lawless one will be revealed, whom the Lord Jesus will overthrow with the breath of his mouth and destroy by the splendor of his coming. [2 Thessalonians 2:8]

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Human Virus

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02/10/2011 09:20 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
I smell Double Dip Doom!bump
HV
Anonymous Coward
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02/10/2011 09:20 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
you should see my local homes and land magazine that is distributed free, here in stores.

about 20 pages now.

it was once 300 pages thick!!


someone is holding back homes
Chris Jusset (OP)

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02/10/2011 09:30 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!


real live DOOOM


 Quoting: DanG 1104571


Not only is this DOOOM real and live, but it's guaranteed to persist throughout all of 2011. Which leads us to 2012 ... and more DOOOOM!

abombabombahhhexplosionexplosion
Chris Jusset (OP)

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02/10/2011 09:35 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
But if the Fed prints lots and lots of money, then the banks, hedge funds, etc., will make big bucks trading stocks and commodities amongst themselves and then those people will buy lots of houses for lots of money and everything will be OK.

Why would you question Helicopter Ben's genius to cure the world's ills by printing lots of money? He knows economics better than anyone!

/SARCASM
 Quoting: The Spirit Of Truth


Helicopter Ben Bernanke would love -- more than anything -- to reflate the housing bubble. I've been told on good authority that every night Heli-Ben dreams of blowing another bubble even bigger than the 2007 housing mega-bubble.

The only thing keeping this abortion of an economy going is Banana Ben's massive printing and ultra-loose monetary policies.
Mr. Toppit

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02/10/2011 09:36 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
27% is just another untrue statistic used to manipulate our thinking. Who do they actually think they're fooling with these bogus numbers.

How about Las Vegas?

That the trouble with having a national media. They can always convince people its better some other place.

Like the bankers combining good loans and bad loans in packages eventually producing toxic waste.

Good news - the toxic waste is only 27% toxic waste this month. Things are looking up.
Chris Jusset (OP)

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02/10/2011 09:48 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
But if the Fed prints lots and lots of money, then the banks, hedge funds, etc., will make big bucks trading stocks and commodities amongst themselves and then those people will buy lots of houses for lots of money and everything will be OK.

Why would you question Helicopter Ben's genius to cure the world's ills by printing lots of money? He knows economics better than anyone!

/SARCASM
 Quoting: The Spirit Of Truth


Also, the quickest and most lethal killer of any housing recovery would be higher interest rates. As ZeroHedge notes: "What happens if the Fed hikes rates? Even with a tiny hike, the good times are over..."

[link to www.zerohedge.com]
Anonymous Coward
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02/10/2011 10:45 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
I heard this information on housing too
I think we are in for a flood of houses that have not yet begun official foreclosure niceties or are just being foreclosed on.


I know that people tried to hold on to properties. Let's face it why pay $2,500 when rent is less than a grand

I also think that the quality of life will go down in the US as we rent more apartments. Not to say that apt living is sucky it's just cramped with no yard.

Another negative consequence of the foreclosures to come will be the flood of pets people will have to give up in order to move to rentals and apts that do not allow them. Sometimes they are the sad tragedy. Heck people get rid of a dog just because they move. I moved 2,400 miles AND took my 8 year old border collie mix for the 6 day car ride...

I think this is a great thread and the more money people are dishing out for food and gas as it increases, the less they are able to pay for too high mortgage payments

Good thread
 Quoting: Anonymous Coward 1249965

There is an old saying that one must live within their means and too bad if people got hoodwinked by all the dreams of castles in the air - after all consumerism does take advantage of gullibility/stupidity.
They have none to blame anyone other than themselves for being so naive.
Please don't get me wrong, my ex wanted a fancy 500k home (with a 3k/monthly mortgage) place when I settled in to buy a place that had me paying same mortgage as rent. Needless to say, she was terribly unhappy with the home, but lots of elbow grease/TLC plus a few modifications/additions to the place over the years fetched me a break even price and felt really sad when I sold it few months ago.
What shocked me the most was that I deposited all that money from the proceedings (70K) into her account and she blew it up in just a few weeks. Speaks volumes about the "entitlement" complex carried around.
What I really feel bad is abandoning pets - because their owners treat them as mere objects to be possessed and show off, instead of true unconditional love.
Chris Jusset (OP)

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02/11/2011 12:31 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
Also, the quickest and most lethal killer of any housing recovery would be higher interest rates.
 Quoting: .


Freddie Mac announced today that tnterest rates for 30-year home loans rose above 5% this week for the first time since April 2010; this is almost a full percentage point higher than in November 2010.

[link to news.yahoo.com]

It appears that Helicopter Ben is losing control of interest rates.
Anonymous Coward
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02/11/2011 12:50 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
they got us!


Me and hubby just cant make enough money(Trucking)

Gonna throw our last 1500.00 on attorney tommorow for ch.13 because BOA gonna sell our home march 1st.

Were only 3 pmts behind as of this month,they moved fast on us.took me 2 hours going through postings at the county clerks office for our property because there were so m any for our county just for the March 1st sales.


Texas
Chris Jusset (OP)

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02/11/2011 01:13 AM

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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
Were only 3 pmts behind as of this month,they moved fast on us.took me 2 hours going through postings at the county clerks office for our property because there were so m any for our county just for the March 1st sales.


Texas
 Quoting: Anonymous Coward 1262037


Only 3 payments behind ... that SUCKS ...

For the average borrower in the foreclosure process, they will have 492 days to live rent-free (vs 382 days last year) before they're booted out. IOW, defaulters on average can continue to live rent-free more than 16 months (20 months in New York and Florida).

[link to dailybail.com]
Anonymous Coward
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02/11/2011 01:20 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
 Quoting: Chris Jusset


Also, the quickest and most lethal killer of any housing recovery would be higher interest rates. As ZeroHedge notes: "What happens if the Fed hikes rates? Even with a tiny hike, the good times are over..."

[link to www.zerohedge.com]



If they raise rates....It will cause a GREAT DEPRESSION...




.
Anonymous Coward
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02/11/2011 01:24 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
It is WAY THE FUCK higher than 27%.
Anonymous Coward
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02/11/2011 01:31 AM
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Re: HOUSING DOOM: 27% of US Homeowners Underwater (up from 23%) !!!
They cant raise rates for multiple reasons.

1. The primary banks ie JP Morgan have hundreds of trillions of derivatives. If interest rates rise by 1% the banks will stand to lose billions.

2. Resetting interest rates 1% will just add to the foreclosures and drop house values even more.

QE 3 is a guarantee whether they call it that or not.

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