An update to a blog I posted weeks ago. Seeing this report you can tell that we still have an issue in the housing market.
According to a new report just out by Zillow Negative equity is down over 13 percent nationwide, but is still a nagging problem choking real growth and limiting new inventory, especially here in Central Florida.
The report states that six million homeowners were underwater in the last quarter of 2015. That number is still a problem, it is a lot lower than the peak 16 million underwater homeowners that we had in the beginning of 2012, and the 8 million of the underwater homeowners from last year.
Zillow made reference the reason the U.S. housing market is moving at a snail’s pace is due to the millions of underwater homeowners who have resurfaced over the past year. Those homeowners have led to a $75 billion decline in negative equity. But while the market has improved from just two years ago, there are still 820,000 homeowners who owe more than twice as much on their mortgages as their homes are worth. Meaning they are upside down.
“Some owners are so far underwater that positive equity may be several years away, leaving them stuck in their homes unable to sell,” the report stated.
Svenja Gudell, Zillow’s chief economist, said that the effects of this nagging negative equity on the overall housing market could be subtle but serious.
“Over time, negative equity can act as an anchor on a housing market, preventing underwater homeowners from listing their homes and reentering the market,” Gudell said. “It is more prevalent in less expensive areas that are affordable to first-time buyers. Without these homes available, many potential buyers are sidelined and unable to take advantage of mortgage rates that remain near historic lows.” #ThatShortSaleGuy #SellMyOverMortgagedHome #ShortSaleMyHome