Homes in the United States have lost trillions of dollars in value during 2008, with nearly 11.7 million American households now owing more on their mortgage than their homes are worth, real estate website Zillow.com said on Monday.According to Zillow 1 in 7 homeowners is underwater. That is all homeowners. It is often reported that approximately 31% have no mortgage. However we would like to see more recent data on these numbers. With the great number of home equity loans and lines that were generated during the bubble, along with the strong push for reverse mortgages a new figure needs to reflect these changes.
U.S. homes are set to lose well over $2 trillion in value during 2008, according to an analysis of recent Zillow Real Estate Market Reports.
Home values declined 8.4 percent year-over-year during the first three quarters of this year, compared to the same period in 2007, the reports showed.
U.S. home values lost $1.9 trillion from the first of the year through the end of the third quarter, and will probably fall further in the fourth quarter. One in seven of all homeowners, or 14.3 percent, were "underwater" by the end of the third quarter, the reports showed.
"In general, homeowners in most areas we cover are struggling with foreclosures pouring into the market, large amounts of negative equity and dropping home values. On the positive side, in the third quarter, some markets - particularly those hit hardest in the downturn - showed smaller year-over-year declines than in the prior quarter," [Dr. Stan Humphries, Zillow's vice president of data and analytics] said.
The bubble attitude changed the view on mortgages - remember taking out equity was no longer flouted as a "second mortgage." Rather the view was that one was using their money own money, now. The post-bubble and economic decline may increase reverse mortgages - something we do not look forward too. However, given the choices people are facing between eating, health care expenses and outright home ownership - outright ownership will probably come in last.
Trillions lost in equity. Trillions lost from retirement accounts. Over $9 trillion lost as we watch the Dow decline. Is anyone adding all this up?