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Underwater Homeowners "Here To Stay" Zillow Says
A few weeks back we commented on the rather disturbing news that repeat foreclosures jumped in January:
According to Black Knight Financial, both new and repeat foreclosures hit a 12-month high during the first month of the year with repeats (i.e. the borrower was rescued but has since entered the foreclosure process again) jumping 11% M/M. More troubling is the trend in repeat foreclosures which accounted for only 15% of total foreclosures during the crisis but now make up a startling 51%.
Here’s what the trend looks like:
Now, a new report from Zillow seems to offer further evidence that the US housing market may not be the picture of health after all (as if we needed more proof after housing starts cratered 17% in February). The percentage of homeowners underwater in the US was flat from Q3 to Q4 which doesn’t sound all that terrible until you consider that this figure had fallen for 10 consecutive quarters. Things look particularly bad in Florida and the midwest where Zillow notes more than 25% of borrowers are sitting in a negative equity position. Here’s more:
In the fourth quarter of 2014, the U.S. negative equity rate – the percentage of all homeowners with a mortgage that are underwater, owing more on their home than it is worth – stood at 16.9 percent, unchanged from the third quarter. Negative equity had fallen quarter-over-quarter for ten straight quarters, or two-and-a-half years, prior to flattening out between Q3 and Q4 of last year…
More than a quarter of mortgaged homes are underwater in some markets in Florida and the Midwest…
Click on the image for interactive version
Zillow goes on to note that we have entered a new era in the US housing market: the era of the underwater homeowner. Even better, the report goes on to note that in a number of cases, borrowers will likely be “in negative equity forever”:
...this represents a major turning point in the housing market. The days in which rapid and fairly uniform home value appreciation contributed to steep drops in negative equity are behind us, and a new normal has arrived. Negative equity, while it may still fall in fits and spurts, is decidedly here to stay, and will impact the market for years to come.
In fact, some homeowners trapped very deeply underwater may essentially be in negative equity forever. And those homeowners are much more likely to own America’s least expensive homes. Making matters worse, many homeowners in the bottom home value tiers are not only underwater, but very far underwater. Consider, for example, homeowners of the least expensive homes in the Detroit metro area. These homeowners are 29 times more likely to owe twice as much than their house is worth compared to a homeowner at the high end of the market.
The good news (and this seems to synch with what we saw in the latest UMich Consumer Sentiment print), is that rich people are doing ok:
Negative equity is not an equal-opportunity predator, and looms larger over less expensive homes. Nationwide, 27.3 percent of homeowners with a mortgage in the bottom one-third of homes by value were underwater in the fourth quarter. The negative equity rate among top-tier homeowners was 9.1 percent. In some areas, this gap was even more distinct. In Atlanta, for example, 49 percent of homes in the bottom-third of home values are in negative equity, compared to 11 percent of mortgaged homes in the highest-valued third.
Now it’s starting to make sense to us why we were having trouble understanding the notion that a “recovery” was well underway in the US. It’s because we didn’t understand that a recovery was usually characterized by an epochal shift towards deeply underwater homeowners and where negative equity becomes a permanent fixture in the market.
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if only they had put all their money in Dana Corp
Pay your monthly payment bitchezzz-
Pay or move in with Mommy, arsewholes.
This analysis significantly understates the % of underwater homeowners for at least one reason - settlement costs borne by seller. For example, if you paid $100,000, borrowed $80,000, owe $70,000 today, home would sell for $60,000, you are underwater by $10,000. But not really. Gotta knock of 6% for transaction costs and say another 1% for other settlement charges borne by seller. So knock off $60,000x.07=$4,000. So you are underwater by $70,000-$56,000=$14,000. Realtors hate this sort of analysis.
that is pretty fucking funny.....someone putting 20% down.....now do ur analysis right, in the land of reality...u know 3.5% down with 105%(rebated closing cost,et.als) ltv and of course we can get you another 25k with this heloc....so underwater by how much?....
This is deflationary news.
I stopped paying well over a year ago, the house is so far underwater that my 20% down payment vanished and is still down about another 20% so I spoke to my wife and a good friend from childhood that specializes in foreclosure defense law as an attorney. We decided that a strategic foreclosure was the best course of action financially. My house had all the markings of a securitized loan that had been bought and sold like _______ whoar. All we do now is bank our usual mortgage payment and pay the property taxes ourselves. My friend believes he can defeat any foreclosure action that they can bring as they have been unable to answer any of his discovery request. He has also won many foreclosure cases already so I know he can do it. F'em they want me to take the lose while they collect on me forever, no no no I don't think so.
keep going i short sold out of mine saving 70% of the loan value. its nice not making payments isn't it?
you are almost through the looking glass, keep going. and for those bitter at my words i made payments for
40 years and because the banks won't do principal write downs long after they have gotten their money back
we are stuck in the mess we have today. stop paying your masters, one day they will see a paying
homeowner is better than a street full of stripped out homes worth less than zero.
I stuck it through on my home and I was down 40% at the worst. My neighborhood dropped 70% from peak from 2007-2010 and then was stagnant for the next 2 years until it started to rise again. Then all of a sudden it rose a lot in 6 months so I sold for what I owed and I bailed with my credit in tact. I also probably had to deal with a lot more shit than you do because the hood was full of illegals and section 8 deadbeats who wouldn't follow rules , overcrowded and trashed everything. The association of course would do nothing. I suppose you gotta do what you gotta do so good luck.
Unfortunately for the rest of us your fuckit attitude is fucking everyone. Especially those who've never owned a home. So fuck you?
You are an IDIOT!
Kudos to all those who fuck the system - homeowners and lawyers alike
the conditions are bankster created not the home owner
You're not F'ing the "game" or the "bank", you're F'ing your friends and neighbors.
If you signed the loan, you are responsible for it. Regardless of how crooked the banks are. You folks are lucky you didn't borrow from a loan shark or you would be in the hospital now. No one made you take the loan, mostly folks were just greedy and wanted moar. Now it didn't work out the way you thought and you don't want to pay up. Personal responsibily is a huge part of liberty, don't like it?. Don't borrow. I have no sympathy. I paid cash for mine and live below my means, I refuse to join the FSA and if you are not paying your debts you have, regardless of how you try to justify it to yourself.
When people sign loans, they are responsible. But when TBTF banks sign loans, they get bailed out. See anything wrong with that?
In any case, your viewpoint is bullish for debtor's prison.
I choose to take the moral high ground and not compare myself or my ethic to the TBTF crowd. So, no I don't see anything wrong with my view point. If you choose to take the low road with the rest of them, good luck. I'll choose to do the right thing, even if no one else is.
Don't hate the player, hate the game. He didn't make the rules, he didn't set up fradulent lending and mortgage financialization leading to the meltdown, he is just managing his position the best he can.
When the big guy thinks he can fuck you , sometimes you have to fuck him first with a broken bottle.
When you willfully play a rigged game, you get what you deserve. Not my sympathies or my congratulations. The players who played the rigged game and bitch about it are hilarious. Don't play, simple.
If you hate the game, why did you play it? If you play, you pay. You don't cry about how unfair it is, if you didn't know that ahead of time you prolbably have no business taking a loan.
First why would anybody need to own a home he can't afford?
And you do you realize he is playing by the rules?
Fuck you too.
you're no different than the thieves in the banking sector. i'm sure you think you're all hot shit and all as you play the same ripoff game the others do but in the end you're no different than the scum you rail against. at the very least you should try a short sale that's at least an agreement with the bank on the loss and how to resolve.
I think this map is misleading at best. The housing market is quite hot in at least some areas.
Yesterday, I wanted to put a bid in on a moderately-priced house in a mid-size Southern city, the house is renovated and is located in an infill suburb (read: good neighborhood, but not old money country club). When I called the broker she said that the house went on the market 3/18 at noon, they had 20 showings that day and 4 bids that night, one of which was accepted. Less than 12 hours on the market. They are taking backup bids, though.
Certainly seems like 2006 housing mania has hit certain cities and neighborhoods.
Yup. Northern Virginia area is 2006 all over again. We are deciding to stay in our rental and wait it out. Even though the rental is nasty as shit, old and outdated at least it's cheap and is a SFH in a decent hood.
I am a real estate broker in East Texas and the Dallas market is on fire. It did this back in 2012 as well and our rural land market usually follows the DFW area by 6 months. But I know they are listing 500,000 - 1,000,000 Dollar homes and getting 4 to 5 offers the FIRST DAY. That is 2006 mania all over again.
At this point, personally, I have sold my home moved out to the farm and put a paid for modular for the time being. NO debt and arable land with spring water sources and plenty of livestock.
I would stay away from homes YOU KNOW are out of your price range but the interest rates want to suck you in and stay the HELL away from most commercial property. I would also add stay away from farm land in the wheat belt that people are paying $20,000 an Acre for. Land here is reasonably priced at $2-3 Thousand an Acre. I'm personally thinking about shuttering our doors at the end of the corporate year in 2016 and switching our office space to a by and trade type place. I have a lot of industrious people in my family and want a location to sell all their stuff.
I don't want to be blamed for this mess. I tell people that are buying homes at 0% down and No closing costs, as they are rolled into the USDA loan, that are making high school teacher salaries trying to buy a 300,000$ home just don't do it. But what can you do if someone just wants something. Only way I can live with what I do. Tell em the truth and if they refuse to listen then that's on them unfortunately.
Zillow mangaed to avoid the word sub-prime. Baannie Fwank would be pwoud. Debt slavery, it's here to stay.
Debtor prisons will be the new retirement communities.
Beat those 50 shades of Realtors; get out there and make them buy, or F******in DIE.
we need a Jordan Belfort in the Real Estate industry....
oh, we did that already? with Fanny And Freddie Fraud? we got 5% down loans FHA????
NOTHING TO SEE HERE THEN, '
SUB PRIME ALONG...
yes zillow, that bastion of accuracy and objectivity......had a friend recently buy a house that showed as 1.66M on zillow.....he bought it for 850k....zillow is a joke created by realtors for the sole survival of same.
Yeah that underwater number just seems awfully low. Ya gotta wonder how many people, with nothing to lose, are about ready to snap.
With all this newly invented QE money out there looking for people you have to figure underwater homeowners are also underwater auto owners. The sub-prime auto shit has caused used prices to go crazy. I've been looking at used pickups for a while and I'm still looking because the prices are mental.
There was a guy on craigslist wanting someone to take over the payments on his almost new 1/ 2 ton truck. He actually explained in his ad he'd be filing BK next week and wanted someone to take over the payments...for 44K!
Throw in a super crappy job or two if you're "lucky" and you really have to wonder how happy and content these people must be, like Jack Lew says they are.
Obama loans....i admittitdly dont know much about them other than you are locked into your mortgage for a set amount of years. That could only contribute to the number of underwater loans, right? Also, are obama loans ARMS? My friend said his mortgage went up when rates moved.... Thanks
Obama loans are bs, better off forcing a forclosure action than reaching settlement, new terms with the bank directly.
here's some typical language....
tOO BiG To fAiL LOan MOdIFiCATioN FOrm r.1.A.002.B.XXXX
The following agreement is approved by the Office of the Comptroller of the Currency, Securities and Exchange Commission, Fair Trade Commission, Financial Industry Regulatory Authority, Commodity Futures Trading Commission, The Federal Reserve System, Office of Thrift Supervision, Federal Trade Commission, Federal Deposit Insurance Corporation, Mortgage Bankers Association, American Bankers Association, National Association of Insurance Commissioners, National Association of Realtors, National Foreclosure Mill Guild, Department of Justice, US Supreme Court, US Congress, US House of Representatives, Office of the President, Office of State Attorneys General, Goldman Sachs, Bank of America, Wells Fargo, JP Morgan Chase, Citigroup, GMAC, Fannie Mae, Freddie Mac, AIG, Morgan Stanley, FHA Refinance Program Fund, PNC Financial Services, US Bancorp, SunTrust, Capital One, Regions Financial, Fifth Third Bancorp, MERS, Hartford Financial Services, American Express, BB&T, Bank of New York Mellon, KeyCorp, Comerica Incorporated, Blackrock, Invesco, OneWest Bank, Discover Financial Services, Ocwen Financial Corporation, Company Corporation, Litton Loan Servicing, Saxon Mortgage Services, Aurora Loan Services, East West Bancorp, Flagstar Bancorp, CNBC, National Association of Notaries, LPS, DocX, Countrywide, Harmon Law, and is subject to the following terms.
By reading this document, which may change or be withdrawn without notice, you waive any and all rights you may or may not have, past, present, and future and unequivocally agree to the following terms under pain of Death.
Before being considered for a loan modification you, your family members (born and unborn), friends, associates, acquaintances and pets, must submit one thousand [1000] certified copies of the following:
1. The amount of any and all bank, checking, savings accounts, including account numbers and passwords.
2. Complete list and location of any assets held in physical possession. [i.e.; in cookie jars, under your mattress, etc.]
3. Birth Certificates, Passports, Social Security Cards, Complete Employment History Affidavits, IRS Forms, Credit Reports, Medical History, and political party affiliation.
4. Vehicle Identification and Registration numbers, including Proof of Insurance, of any and all vehicles and supporting Affidavit[s] describing their use, purpose, mileage, and location.
5. Certified DNA samples.
6. Certified Finger Prints.
7. Certified Retina Scan.
8.Certified Blood Sample.
9.Certified Urinalysis Examination.
10.Proof of Title Insurance payable to the undisclosed party and their agents.
11.Proof of Title Re-Insurance from Lloyds of London payable to the undisclosed party and their undisclosed agents.
Certified copies of the complete list above must be mailed to the undisclosed party and their undisclosed agents within twenty four [24] hours and must be received by the undisclosed party and their undisclosed agents within twelve [12] hours at the following address.
UNDISCLOSED PARTIES AND THEIR UNDISCLOSED AGENTS
P.O. Box 1776
Maiden Lane
New York, NY 10005
Alternately, to better serve our customers, you may send your complete document package via fax to the number below. Attention undisclosed party and undisclosed agents.
1-800-GET-LOST
In order to assure Quality Control, upon receipt of the documents listed above and in addition to any and all others that are required but not disclosed, your eligibility for a loan modification will be determined by an undisclosed party and their undisclosed agents that may or may not be a party of interest and may or may not have standing to enter into any potential agreement[s].
The undisclosed party and their undisclosed agents retain the right to commit state and federal mail fraud, wire fraud, FDCPA violations, unfair and deceptive acts and practices, conspiracy, money laundering, racketeering, tax evasion, fraud upon the court, uttering fraudulent documents, fraudulent conveyance, slander of title, financial institution fraud, securities violations, and identity theft with impunity.
The undisclosed party and their undisclosed agents neither admit nor deny any involvement in any potential agreement[s] that may or may not result. Any agreement[s] made are non-binding and the undisclosed party and their undisclosed agents shall be held harmless from the beginning of time to eternity.
In accordance with the strict guidelines established by the undisclosed party and their undisclosed agents, any potential loan principle correction shall be no less than the original outcome based appraisal value and shall be no more than one hundred [100] times Present Market Value with a variable and/or fixed interest rate not to exceed one hundred [100] percent.
Should an agreement be reached between the undisclosed party, their undisclosed agents and the borrower, the borrower, the borrower’s family members (born and unborn), friends, associates, acquaintances, and pets shall agree and consent unequivocally to the following terms.
1. The borrower’s breech of any potential preliminary agreement shall be determined solely by the undisclosed party and their undisclosed agents.
2. In the event of borrower’s breech of any potential preliminary agreement; the borrower, the borrower’s family members (born and unborn), friends, associates, acquaintances, and pets shall waive any and all rights previously afforded them up to, including, but not limited to the SPCA, US Constitution, The Bill of Rights, and The Geneva Convention.
3. In accordance with the strict terms established by the undisclosed party and their undisclosed agents, the borrower, the borrower’ family members, friends, associates, acquaintances, and pets consent to unlawful search and seizure, wire-tap, harassment, kidnap, torture, trespass, ankle bracelet monitoring, random drug tests, unmanned drone surveillance, unlimited detainment, mandatory behavior modification and Pepper Spray.
4. The borrower’s breech of any potential preliminary agreement shall immediately result in wage garnishment for the borrower, the borrower’ family members, friends, associates, acquaintances, and pets.
5. In the event of borrower’s breech of any potential preliminary agreement; the borrower, the borrower’s family members (born and unborn), friends, associates, acquaintances, and pets consent to a permanent barcode tattooed front forehead and both temples that shall remain visible at all times.
6. At the sole discretion of the undisclosed party and their undisclosed agents, the borrower, the borrower’s family members (born and unborn), friends, associates, acquaintances, and pets consent to indefinite detention in an approved FEMA camp or Guantanamo.
7. At the sole discretion of the undisclosed party and their undisclosed agents, should the costs associated with incarcerating the borrower, the borrower’s family members (born and unborn), friends, associates, acquaintances, and pets become burdensome they consent to extermination.
8. The borrower, the borrower’s family members (born and unborn), friends, associates, acquaintances, and pets consent to, and rightfully accept complete responsibility for destroying The US Constitution, The Bill of Rights, the wholesale corruption of our government, and the destruction of the World Economy.
TERMS OF THE AGREEMENT
Due to the proprietary nature of the strict requirements dictated by the agreement between the undisclosed party and their undisclosed agents, the terms of the potential preliminary Loan agreement cannot be made available to the borrower, the borrower’s family members (born and unborn), friends, associates, acquaintances, and pets. They are articulated in the attached contract found on pages [7 – 30,000] and will be stored somewhere at the sole discretion of the undisclosed party and their undisclosed agents.
The undisclosed party and their undisclosed agents retain the right to alter, destroy, or lose the 29,993 page attachment.
________________
Deadbeat Signature
Affix undisclosed party corporate seal here (optional)
You are crazy!
invest in facebook
I couldn't think of anything more sarcastic to do with my money. This is probably decent investment advice in a world gone full retard.
Negative equity and negative interest rates coming soon !
If nothing else discourages millenials from "home ownership"...
Great example of the hazards of falling for propaganda and group-think-- "The price will never go down!"
No worries-- VCs will gladly purchase that bag you got caught holding... for pennies on the dollar...
the prices they're asking clearly indicate they have no appreciation for incoming deflation. asking price has not adjusted to the reality of what people are earning outside of the 1%
So. That window Guy Haselmann was talking about. That window during which the Fed might conceivably have raised rates (he suggested it might have been some time in 2014). I think that window might now be closed.
Sigh.
Oh, wait till the 2005 HELOCs 2nds burst in 2015, and remain in 2nd lien position; and the 17% foreclosed
cant refinance HUMDA, BUMDA, BIMBO Govvy scam refi programs with neg equity, cause the 2nds are in the way.
OH OH!!!!, be like Vegas, if it was foreclosed 18% of homes will stay foreclosed...forever.
Fny how the harp program will only lead to more HELOC's. Never ceases to amaze me. However, if QE and TARP taught us one thing, is that its ok to turn your house into a credit card. Why? Well, because nobody ever has to pay their bills! Its like little kids asking for a "do-over"
Why haven't we seen more fallout from the 2004 HELOC busts in 2014? I remember a chart prepared by Credit Suisse that showed that there would be DOOM in 2014. It didn't happen. Why will 2015 be different?
Hey, does this mean all my favorite shows on HGTV will go the way of the dodo?
"Love it or List it", "Fixer Upper", "Income Property" ...
and my personal favorite, "Property Virgins"
where can i find the zero down I need?
Fed is saying dump US dollar. They and their banks have unlimited printed money to buy up 100% of the mortgage and treasury debt.
Every underwater homeowner needs to STOP paying. Demand principal reduction. Otherwise live in house 5 years and then short sale to another underwater neighbor and vice versa. It's time for American homeowners to WAKE THE FUCK UP. YOU WERE ROBBED OF YOUR EQUITY !!!!
I would agree, however, are you aware that you have to pay taxes on that forgiveness?
If you short sale a house, say 80K, the tax laws are such that you owe taxes on that 80K. While the bank gets stiffed, the federales never do.
AFAIK the debt forgiveness act of 2007 is still in effect. I'm pretty sure it was just extended again making home debt forgiveness in short sales and foreclosures non-taxable. Many banks choose to come after the owner now for the deficiency anyway instead of forgiving it or at least that's what I've been told. In the old days not so much but now they are getting more aggressive about the deficiency.
Remind me again who forced people to sign the mortgage agreement.
The same ones who forced you to sign the rental agreement.
You must have me confused with someone else. I only pay taxes on my property.
( chuckle ).....Then you're still a tax nigger and slave. Who forces you to pay property tax? Stop paying your property tax and find out. You don't own shit....ever....in this life and in this world.
It doesn't bother me to pay property taxes. Pretty sure you have no idea what's important to me. I can tell you I don't waste my time dwelling on how to buck the system or envying those that have a bigger slice of 'this world' than me.
But soldier on. You seem to be pretty enamored with yourself.
Pretty sure I don't give a shit what's important to you. You spoke up and said that shit for brains phrase....."Remind me again who forced people to sign the mortgage agreement."
I'm pretty sure you don't know dick about the myriad of circumstances why those homeowners can no longer afford their house. Most didn't overbuy......until they found out they did because the same rat bastards on Wall Street and their bought and paid for political whores in Washington D.C. set those folks up to fail for their own personal gain. The same Ponzi scheme these ass fuckers set up that drove up property prices was the same scheme that allow businesses to over-invest and thus hire a bunch of folks who COULD afford that house at the time. And when the Ponzi broke, not only did it take down the housing market, it took down the job market. Good, honest people who bought homes they could afford at the time, now cannot.
But you just sit there in your easy chair, drinking your beer, stewing in your own smug juices and paying your property tax for fear of the State taking your shit that you think you own......and believing your own bullshit lies so you can make it through another day in this hellhole.
What a stupid cocksucker you are.
"Americans are not deadbeats."
barry said so.
Exactly, funny how smart some here are.....in hindsight! Now the way they are playing it no different than the banks et al they bash.
Remind me again who forced the banks to hand out mortgages for overvalued property?
US govt. They (the banks) weren't allowed to discriminate against the low income types that wanted to get rich via real estate.
Robbed of equity? How do you figure? Overwhelming majority of buyers use taxpayer subsidized FHA type mortgages and consequently have very little 'skin in the game.' We have never bought a house w/o paying at least 20% down. Sometimes we made money on the sale, and sometimes we barely sold without losing our ass. Markets rise and fall, and if you don't have to sell in order to take a job out of the area, you have to live somewhere. Free will and consequences...just sayin
It's like millions of little Greeces.
Graph 2. That gap between the black column (27.2%) and the dark grey column (15.8%). That should be way smaller. That ain't a normal distribution.
Black column covers twice the width of the other columns, and it's a zero-bound distribution. Nothing unusual at all about the distribution. Typical skewed lognormal or exponential underlying, with a fat tail.
Robbed of equity!? $hit, you were in a losing proposition as soon as you agreed to property taxes, control of use of your property, and a sundry of other sins. Of course, I know y'all did it for the Chidren. Good job muppets!
I guess you believe that renters don't pay property taxes, however indirectly. If the owner of a rental property has a positive cash flow then the property taxes are 'paid' by the renter. If you rent property, your ability to use the property is usually quite limited; not only is a renter restricted by the same governmental regulations as an owner occupying his own property, but a renter is further restricted by what the owner will allow.
When you overpay for these overpriced houses this is the result. No one forced them to buy so time to learn a very hard lesson.
Amen, Dust
Clearly you've never had a wife.
Clearly you have never hear of divorce. Still up voted you though.
So it's wrong to default on a mortgage but okay to default on a marriage.
Hypocrisy much?
That was sarcasm. But, if you have a spouse that willingly leads you down a path to finanicial ruin, by All means default on the marriage. A spouse is a business partner, if they are ruining your household economy then so be it. They are the one in breach of contract if their irresponsibly causes you harm. I see that as very different then not paying a debt you asked to take on. Everyone just wants to feel OK about not paying their debts, students, mortgage holders, TBTF banks, etc... Whatever lets you sleep at night I guess. For me I will take the high road, that's why I married a woman who has the same economic sensibilities as myself... So don't find myself in that conundrum. Choices, consequences, responsibilities, all that good stuff.
The problem with the housing market is fear, fear of government , fear of loss of employment, fear of a wage cut or hours cut. Democrats and Republicans alike have done more damage to this economy both physically and mentally. Who here at this stage seeks out new debt in this environment? you don't you try and mange what you already cant pay.
All I know is I will be punished severly for questioning the narrative and staying out of the housing market. Along with making voting mandatory, think of how amazing it would be to mandate a mortage. Then everyone would be GUARANTEED the American Dream™. Or he will just say, we will guarantee the value of your home and you will not lose one cent, then I'll be on the hook anyway.
I feel like the "smartest" thing to do in this new normal is just go along with the suckers and wait for the bailout/ prinicpal wirtedowns. Being conservative and careful with your money gets you nowhere.
All I know is I will be punished severly for questioning the narrative and staying out of the housing market.
That's some funny stuff, but when has trade that is too crowded ever gone the right way? It always ends badly, and this time will be no different. There is no free lunch so remaining debt free is the only appropriate (and sane) course of action.
Strategic defaults coming back?
Renting from the bank is a serious morale crusher.The sheeple trudge along (not ahead)
The spector of Greenspan's / Mortgage industry "easy money" years will be with us for decades.
Oh!? What's on TV later? March Madness!
So if the 3 bed, 2 1/2 bath credit cards are overdrawn, and Janet is not printing, where is all the new debt going to come from to keep the Ponziconomy going???
Zillow has listed a home I bought in 2004 for 290k. Zillows says the current value is worth 262k. I tried to sell it at a short sale. Only offer was for 200k. The bank refused the short sale. Zillow is full of it.
ZARK TO ZANTASY.
In the Northern Va area Zillow almost always undervalues the home. I put an offer on a short sale a few months ago at $15k over what Zillow valued the house and the surrounding comps in that hood were consistent with my offer and the bank decided to auction the home instead with the reasoning that they could get more at auction for it than my offer. I haven't seen the RE market this nuts in the DC area since 2006. We are in the nastiest, shittiest rental atm and would do anything to get out of here but looks like we are stuck here for another 6-12 months to wait out this cycle...
Yes, the Northern VA market is insane. All that government spending. I can understand why you would want to get out. It sucks.
" all markets are local"
The first chart is misleading. It's not surprising that a high number of repeats originally developed at the peak would carry on into the future, regardless of the steady decline of more recent rates of first foreclosure. "Saved" foreclosures have always been notoriously likely to fail repeatedly. Low/no-down mortgages are once more on the rise and also more likely to fail. Again.
And yet, prices in South Florida continue to climb. Went to Miami last week. There are bidding wars on ocean front property and condo's. SFH in Dade, Broward, and Palm Beach County are up 15-20% YOY and no inventory. For all of the handwringing about home prices cratering, as a prospective home buyer, I do not see the opportunity to find any bargains in the near future within this area. Even REO's and other foreclosures are scooped up in days and are demanding close to "market value".
What am I missing here chaps?
You have to be crazy to want to live in Miami ?
My realtor client is complaining about a lack of supply, yet all around there are zombie properties.
Go figure.
Don't listen to realtors, they're the fools who own most of this underwater property.
This one sold ALL her property around Xmas.
Do as I say.....
Same in DC area. Little inventory and what there is seems to be climbing in price every week all of a sudden. We are deciding to wait it out for another year since it's starting to look too much like 2006 again around here...
i bought a house in 1998 for 169 K. On zillow today i would be lucky to get that much for it. So for 17 years i have paid mortgage interest of roughly 12 K a year. Homeowners insurance of 1200 a year. Property taxes of varying amounts between 5800 and 7200 a year. Do I need to ask who I have been working for the last 17 years? Oh,,, we won't talk about income tax, gasoline tax, tolls, sales tax, tax on cell phone bill, etc. etc. Any questions who we all work for? Class? Class? Didn't think so not on this site at least. Good weekend to all.
Jesus son, you in Jersey or something? $7200 a year on a home valued at $169k? Fuck that. And I thought Manassas Park Va's property tax rate (the highest in the state) was high at 1.7%!
A roof over your head should be free!
HOmey,,, location, location, location. You aren't missing anything. That and the monstrous infulx of foreign cash into areas like you are looking at buying.
I'll be damned if I am going to have to commit to purchase a home for $500k+ for the fear or being priced out. Shades of 2005 again. Been renting for about 10 years since the crash and don't have the cajones to commit. Problem is all od the houses have been purchased by Blackstone type investment firms and foreigners paying cash, then renting out. Rents are thus going up 10% each year so the cost of renting v buying is not such a bargain as it was a few years back.
Seems the only viable option is to move to a more affordable area which is not such an option when you have employment. That or continue to rent and be at the mercy of a landlord.
I spray peoples houses (exterminator) for extra money. One of my customers is a couple who have declared bankruptcy 8 times in the last 15 years. Their current home is worth about 1.5 million dollars. I was just over there the other day spraying their house and they said they were in foreclosure and filing for bankrupcty again. I commented by saying "oh thats unfortunate".
They both laughed... and said it was great, because they'll just move into a bigger, newer home - and get all new furniture, new cars, trucks, clothes, everything.
Dammit!!! These people are millionaires!
In the meantime all I hear is a bunch of people bitching about negroes on welfare collecting food stamps.
Please get me the name of their attorney! He sounds like a genius who has circumvented all the rules as to how many times you can declare bankrutpcy within a given timeframe.
THEY are both attorneys. They do all the bankruptcy and foreclosure filings themselves.
BTW, they are my only customers who I require to pay CASH up front for my services. For everybody else, I just give them a bill.
Oh, and a second BTW. These people have been customers of mine for years. I've seen them do this time and time again.
And you know what? Every time I go over there I have to listen to them bitch the whole time about negroes collecting welfare.
i'm wondering what chapter they're using because chapter 7 and 13 definitely have time limitations.
they sound like complete assholes. may karma bite them in the ass
Achoobullsheet, whew excuse me. I work in the industry and have never seen even close to 8 BK in 15 years.
Maybe they alternate his and hers. Heck, maybe they have run up debt in their children's names.
They would be kicked out of their state Bar association if that were true.
Doesn't that require ripping off another lawyer, or killing a judge in open court ?
I doubt that situation would occur. The Code of Professional Responsibility is an oxymoron if ever there was one.
liar
"Hey, your gold doesn't pay any interest .... like my savings account !" .... finally we have a rebuttal !
This is a bad situation. There are real costs associated with this situation. Federal reserve should do more to encourage inflation. Also US government should encourage write-downs on underwater mortgages. It's a tough decision because there is certainly an element of moral hazard, however when the issue is systemic rather than isolated, and the damage to the economy is high enough, the benefits outweigh the cost.
What the hell is wrong with you? Inflation is theft.
Anecdotally, in my large-ish metro area there are very few homes on the market. If you want to buy a $300k-$500k house you are competing against 10 other offers on the property. The winning bid has typically been a cash offer willing to waive the inspection. That sounds crazy to me. How many of these people could possibly be looking for a real home to own and live in? How many of these people are buying only as an investment/income stream? If you are a person who has already defaulted on a mortgage back in 2009, how do you suppose you can compete with the all cash buyer? I understand that banks need to extend credit to even the least worthy, but that doesn't mean that sellers will accept their offer over a cash buyer. Perhaps I just live in a place where the housing market is behaving differently than what I read about here. I guess one similarity is that, without doubt, the market is in a huge bubble here with prices in my neighborhood going up 20% in the last 12 months.
Captchured may I ask which metro area you are in?
Denver. Another piece of data to help tie my entire digital life together. Lord knows what sidebar advertising, mailers, and drone visits I'll get now!
I've read Denver is getting a big influx of population due to the new legalized marijuana industry there.
We found the market hopping in SE MI of all places. Yes, good schools and a nice area, but nothing special housing. Multi-showing/multi-bid in the first few days on anything decent.
If you check Zillow there are plenty of old foreclosures sitting out there, but not on the market for sale.
Putting my formally underwater home on the market a week from today. Never thought it would get back above water but thanks to that con man Elon Musk the home prices in Reno have rebounded. Getting out before they figure out that Elon is Howard Hughes and the Giga Factory is his Spruce Goose lol.
How did the prices rebound in Reno? Isn't it the same area with shitty hotels and casinos?
Did Apple move into town?
I really don't know for sure but my place had been flat at the lows since 2011 and then in March of 2014 the Zestimate(lol) started shooting up. Sometimes as much as 6K every month. The Gigafactory was proposed in February of 2014 but Nevada did not get picked until September of 2014 so the start of the bump was probably not because of the GigaFactory. From what the agent said there is just no inventory, no new homes being built, so basically lack of supply and just enough suckers, I mean buyers lol.
Congrats mate. I know the feeling. Was underwater on my hovel for 6 years in an illegal alien/section 8 overcrowded hood in Manexico Park, Va and all of a sudden in Summer 2013 the prices started to go up by $5k a month. I sold ASAP and even made a few grand in profit after all was said and done after 10 years of home ownership. That town got totally devastated during the foreclosure crisis. It was one of the worst hit zipcodes in the nation and the entire fiasco was somehow kept out of the MSM. The town is literally FULL of illegals since 2005 and when they foreclosed, everyone's favorite section 8 types swooped in and rented from the investors who bought the homes for pennies on the dollar in 2008. Fucking nightmare living in that neighborhood for the last 5 years before I could sell and break even.
Congratualations! Your story is a horror and victory story at the same time. You were paying close attention to the market and acted accordingly.
Yeah well if that were the case I would have sold in 2006 and banked $200k in profit. Instead I was lazy, didn't want to pack my shit and find a new home. All of a sudden the wheels fell off and a year later the hood was full of section 8 assholes.
j0nx, when I read your posts the other day I figured you had bought in either Manassas Park or South Riding. Friend of mine is permanently underwater on $750k+ hovel purchased in South Riding in 2005. Pretty much ruined him.
You wish. Sorry all you banksters and bankster shills. We all must die some day, even you. Thank God the Long Enough Time Line isn’t the forever time line, and there is at least one certain way to escape debt servitude.
So soon, we'll all be mermaids and merdudes, except those who rent?
Black Knight financial? You mean the former Lender Processing Services, aka, Linda Green, aka Doc-X, the company that admitted to forging over one million foreclosure documents? The company that settled with the DOJ and State's Attorneys General of 48 states? The company whose audit OVERSEEER of these forged docs was "Treliant", a company made up of bank stooges?
Black Knight with new owner too! Black Knight...FUCK YOU. Title companies and their owners engage in fraud on a daily basis. MASSIVE FRAUD.
Still living in my home after three years due to bank submitting forged note in foreclosure complaint. Original bank wants to dismiss case against me but I won't let them until judge hears about forged note. New plaintiff will be well known criminal outfit, Nationstar Mortgage, LLC. Notice how insiders of Nationstar have been selling their shares? Ummm....guess they know about SEC investigating them for their various crimes? YES.
As an aside...Nationstar attorneys wrote my attorney complaining of my inflammatory language. I told attorney of my first amendment rights and that they were crybabies. Oh...if they didn't like what I wrote SUE ME, you worthless fucks. Thank goodness their attorneys are drowning in student debt, wear shitty suits and can't get laid due to being constant liars.
You can see some worthless Nationstar attorneys on YouTube. Christopher King has some good ones. Pussies.
So, to recap: Fuck you Nationstar and Black Knight. Zillow? Junk.
Just in! Well...sort of. Nationstar Mortgage, LLC insiders are SELLING!
http://www.thestreet.com/story/13084852/1/insider-trading-alert--nsm-fgp...?
Just tell me how you really feel. /sarc/
Remembering that the average home nationwide is currently $189,000, if what this article is saying is that the underwater problem is greatest below the median, then we're talking people with $100k mortgages paying like $800/month. They may be underwater by $20,000, per that chart. Which is probably a fair chunk of money for the people involved, but not enough to sink the banking system.
Therefore, it seems to me it would behoove both sides if it could be written off over five years or so, half by the banks, half by the individuals - should they be lucky enough to be paying taxes, though at those numbers they are probably not, so give permission to the banks to write it *all* off over ten years. And maybe faster if and when the property changes hands - although then you'll get a lot of bogus transactions just to exercise the clause.
I just made all this up, could you tell? So if I messed up the logic, well, I'll try again some time.
In short, the total amount of underwater-ness for homes under $250,000 is probably about 8m homes times $10k or $80b, written down by the banks over ten years? They spend that much on bagels and Keurig. If Obama and his idiot minions had IQs as high as their golf scores, they'd be all over this.
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Oho, Black Knight, is it? I did a little stuff for LPS back a year or three ago, ...
A home is where your debt is.
The central bankers are clearly setting the table for a "crisis" yet again. Then comes the "reform". Movie shows some nice little known history of how they do it. https://www.youtube.com/watch?v=p5Ac7ap_MAY
Legal tender laws steal our assets and labor giving us worthless fiat in return. It is a clear violaiton of the 5th amendment. They never talk about HOW they managed to pull this off. They screwed us all with a court packing scheme to do it. http://www.thetruthaboutthelaw.com/they-make-you-use-money-that-is-backe...
As a millenial... Fuck your equity, and your home ownership dreams. Welcome to the reality bitchez. Hope it changes but not likely since our borders are overrun now with marxist meat puppets. There's freedom not being chained to a shitbox home that's ever losing value due to counterparty risk: Banks, Shit-for-brains legislators and currency warfare. A home isn't an investment, its a liability until it's paid for. Homes are perpetually underwater now?! We haven't even begun to normalize, wait until massive deflation hits your home value and your food costs as much as typical rent.
Given the terms of the FHA loans, it sounds like you're putting it on lawaway and to allow the closing costs to be financed as well is just brilliant!
Isn't it great that people that wouldn't have qualified for a mortgage in a sane financial world were given the chance, by politicians in our government that did it for their own gain, are now permamnantly fucked? The sheeple will never understand how they are constantly being screwed by government policy. All this free stuff they get is not free. They pay on the other side with bankruptcy and ruined credit. The politicains go on to make millions.
http://www.amazon.com/If-West-Falls-Globalization-Biblical/dp/144972180X...
I think it don`t will take a long time: Then the West Falls...............
I got caught up in the frenzy in 2005 and bought my first home in 9/2005 in DC area. Ouch. And I should have known better. Got out last year and managed to sell for $60k more than a paid. Felt like a miracle came my way - no, really. My perspective has been permanently altered, especially as relates to thought process gone through prior to signing any contract.
...yet your typical progressive ass clown around there (I'm looking at you, much of Loudoun Cty), will tell you how great everything is, and if you're an American who needs steady work and a 'new life', well, doggone it, fill up that moving van and move to NoVA!
The title of this artlcle includes a misnomer as the resident(s) occupying the structure are not the "homeowners". If the occupiers of the residency borrowed money in order to be allowed to dwell in the structure, they don't own jack shit until they pay the debt off.
You may be thinking "Hey Joe Camel, no shit Sherlock". I know, but the term "homeowner" is very incorrectly used and it to me it is just a propaganda word to make people have a false sense of success and accomplishment.
Exactly, the moment a payment is missed and no matter what equity you have built up the property reverts to the bank.
Everybody holding a mortgage is at risk.
If humans were engaged in the game we would get offered the problem whether it is allowed or not to trespass the private marked zone.
To throw anybody out of his place, unbelievable.
The lack of such reflections to the favor of more important "economically" considerations tells it all.
Slaves who complain that the chains are placed unlucky.
America in the lead of the trend of making the planet inhabitable for humans pays a high tribute to fodder that agenda.
SO many peeps on here calling a 2006 like top in RRE. I got news for you mooks, as the Fed's tinderbox burns hotter, the realization will come. Then you will see the difference between a bubble in housing and a collapsing currency...
Just look at that red blob over Atlanta, LOL.
Anyone who has been reading ZH over the years should know we are approaching 2006 all over again. The stock market is on the verge of a huge 50-60% collapse, oil prices have collapsed, the dollar's gone parabolic, PM's are in the toilet....deja vu?
I sold my home here in Colorado 3 weeks ago. When we bought in, yes, 2005, we were immediately $50k underwater. Now, with all the wonderfull dope-smoking zombies moving here, home prices have hit the roof. We found a place to RENT one day before closing....we were almost out on the street. There is NOTHING to rent. ($1875/mo for modest home..WAY overpriced).
I talked to a guy today having a yard sale...he said he bought 5 years ago as an investment (right AFTER the crash...I asked) for $205K and sold for 300k...had like a bazillion showings and offers.....can't recall all the details but I congratulated him for getting out at the top.
This IS the TOP, again. Man were we lucky to get out with our asses intact. People are saying the Dakotas are looking good.....
Most are happy to die in there home.
We need to forget tham and build millions upon millions of new homes at about 100,000 each.