In what could be another sign that the housing crisis is far from over, the percent of mortgage holders who are underwater on their homes continued to rise in the third quarter–and some say it could be another eight to 10 months before that trend turns around.
In the U.S., 23.2% of U.S. mortgage holders were underwater, owing more money than the house is worth. That’s up from 21.7% from a year ago, according to Q03 data out Wednesday from Zillow.com. Roughly 13.9 million homes now have negative equity. Many of these homes could end up in foreclosure should borrowers give up making payments on homes that aren’t worth what they owe—let alone building equity. (See “The Great Mortgage Mystery“)
In the latest report, the worst hit areas of the housing bust show small signs of improvement, while new locales saw growth in underwater real estate. In Miami, for example, 42% of homes have negative equity, compared to 45.1% in the third quarter 2009, according to Zillow. That’s in part because many of these underwater homes have been foreclosed on.
In San Francisco, the number of underwater homes has dropped from 24.9% to 20.2%, mainly due to stabilizing home values that are pulling more people out of negative equity, says Stan Humphries, Zillow’s chief economist. The median sales price of existing single-family homes in the San Francisco metropolitan area is up about 25% since last year, according to the National Association of Realtors.
Source: Wall Street Journal
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