Home equity - falls below 50%
Just what we needed. More bad news when most homeowners are struggling to keep up paying on their mortgages. Now this. For the first time on record since 1945,homeowners percentage of equity in their homes has fallen below 50%. After saying just this,I don't even know if I should even say more. But maybe reading this,some homeowners might want to put their homes on the market hoping to at least get something out of the selling their home before it is too late. And with spring approaching soon and more home buyers looking to buy a home,this would be a great time for home owners to put their house on the market who have been hesitant to sell but was not sure whether they should or not. Homeowners will make up on the buying side what they are not going to get on the selling side.
In the second quarter of 2008,homeowners percentage of equity slipped to lower than 49.6%. It declined even further to 47.9% - the third straight quarter it was under 50%. This marks the first time that debt have exceeded equity since the Fed starting tracking data in 1945. This of course is terrible news for the hardworking american citizens who have worked so hard to own a piece of the American Dream.
The total value of equity also fell for the third straight quarter to $9.65 trillion from a downwardly revised $9.93 trillion in the third quarter. Economists expect this figure to drop even further as declining home prices eat into the value of most Americans best investment. What's disturbing about all of this?Moody's Economy.com which is a trusted independent provider of economic analysis,data, and forecasting and credit risk services estimates that 8.8 million homeowners, or about 10.3% of homes,will have zero or negative equity by the end of the month. While around 13.8 million households or 15.9% will be "upside down"if prices fall 20% from the peak. This is not good news at all. We just have to pray that it gets better soon. We'll just have to wait and see how this all plays out.
To receive a free list of "Houses for sale in Washington DC",please give me a call at your earliest convenience. I can be reache at (202) 378-0283 (Direct) or (301) 560-6700 x1154. I can also be reached online on my websites www.buyandsellnewhomes.com and www.freelistofhomesforsale.com Thank you very much. Looking forward to working with you and helping you make your home purchase a stress free and very happy one. Lanre Folayan - Real Estate Professional - Exit Premier Realty. "Buy and sale a home in Washington,DC"
Just going to get real tight for a while. Need to help the ones we can and give good advice to the ones we can not. Wonder how long?
Thanks
Tony
Tony-Wonder how long? That's what I said. Thanks for your comments.
Larry -Totally insane. I still can't believe the stats myself. Thanks for your comments.
Ray-I am praying so Ray. It has been tough so far and this is only March. But spring is approaching soon. Thanks for your comments.
Jennifer- Isn't that the truth. Only if some people would've put their equity to good use. Thanks for your comments.
Hey Lanre - that is not good info! That is kind of scary news for up there! At least they can work with someone like you who can advise them what to do in this everchanging real estate market!
Lanre - You know yourself that all of these numbers only matter to people who are buying and/or selling, or refinancing, right now. To everyone else, it's just a sensation. Any and all buyers who are in the market at this time and who are buying non-contingent, this is the best time to buy. To everyone else, it is what it is. I counsel my clients according to their situation. If they do not have to move right now, and if it is NOT IN THEIR BEST INTEREST to move right now, I recommend they don't.
Have a good weekend.
Sometimes the best advice we can give to folks is -WAIT to sell. I have had a couple of those hard conversations this year. It's not easy (especially since we have to earn a living) - but not being honest with folks does no one any good!
Naoma - It is never good news. Nobody wants to lose part or all of something they spent years building. But like you said,we can advise them on what to do in this ever changing real estate market. Thanks for your comments.
Marzena -You are absolutely right. If it is in their best interest not to move right now,don't do it. Have a good weekend also. Thanks for your comments.
James-That's why you are a very good real estate professional and will always get referrals. Thanks for your comments.
I read that just the other day. It at 47.9 percent. The third straight quarter for the decline.
Sandra - Scary isn't it? But things are going to get better soon. Thanks for your comments.
It's a great buyer's market in Alabama, Home Buyers are really getting a great deal...
I want to make a comment about the home sellers/ Home Owners that are in trouble......
I really wished that it was more that our government could do... I have been told by home sellers - Owners that they are not getting the help that the media is advertising and the lenders are promising them.......for example a home seller called their lender for help......
;;;.guess what it? it took the lender 3 days to answer the phone.......the home seller - owner expressed that he was in trouble with his mortgage (adjustable rate) and that he needed to refinance....... the lender accepted and made the arrangements for the closing ( stated this verbally) but the lender never sent the package off for closing / escrow for the refinance.......
....the seller is once again is on the phone calling the lender......... Keep in mind this is one of the largest lenders in the United states......I would tell you their name ,but I dont want to risk being sued..... it is sad to say that the lenders are not doing anything but giving the current homeowner/ sellers a serious run around.........its nothing being done.......
Lanre-Great post! These homeowners must be sick about the situation there. Hopefully, it will all get better, sooner than later. Sad times we are living in these days.
Luckily, they have a great agent like you to advise them on how to best handle their situations. Take care, and happy Easter!