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Real Estate News Releases
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(EMAILWIRE.COM, June 10, 2008 ) SAN FRANCISCO, CA – Home equity levels in the United States have dropped to a level of 46.2 percent, the lowest figure since the 1940s.
Home equity is defined as the market value of a home less the amount owed on it, and this declining fraction has been below 50 percent for 5 straight quarters as the housing and mortgage crisis continues to unfold. For homeowners looking to sell a house fast this news is challenging because low equity levels may prevent a sale at a price that will pay off an existing mortgage loan.
News is good for foreclosure home buyers
For homebuyers looking to buy a home or a foreclosure home the price declines can be good news. In addition to regular homeowners who are looking to sell their homes at fire sale prices banks and other mortgage lenders have large amounts of foreclosure homes for sale, further depressing home prices. These REO properties, or ‘real estate owned’, are often priced below current market values by dispassionate lending institutions that are looking to sell their inventory of houses quickly even at a significant loss.
Total home equity values
In real numbers the first quarter of 2008 saw US homeownersÂ’ decline to $9.12 trillion down from $9.52 trillion in the last three months of 2007. Debt levels on homes increased from $10.53 trillion to $10.6 trillion.
Experts predict further price declines as mortgages become more difficult to obtain for borrowers, especially those with poor or subprime credit histories. The Chief Economist of Moody’s www.Economy.com, Mark Zandi predicts that by June of 2009 homeowners with ‘negative equity’, i.e. owing more on their house than it’s current fair market value, will number approximately 25 percent of total American homeowners. This is a marked forecast up from 16 percent at the end of March 2008. In positive contrast with this number are the roughly one-third of Americans who own their homes without a mortgage owed.
House selling options
Foreclosure expert and real estate commentator Patrick McGilvray, J.D. and president of www.TheHomeBuyingCenter.com, an internet-based real estate services company that helps homeowners sell their houses and helps home buyers buy below market foreclosure homes opined about the falling equity levels, “We explain this unfortunate reality to thousands of Americans every month who call The Home Buying Center.com in hopes of selling their house fast for a cash to a real estate investor. I encourage homeowners to call my team or their local government homeowner counseling service to learn about their options in selling their home in today’s challenging market. Knowledge is power, especially when it’s based on up-to-date information.”
Foreclosure numbers up
According to the Mortgage Bankers Association (www.mbaa.org), new foreclosures and late payments to mortgage lenders in the first quarter of 2008 were the highest since 1979. Almost one percent of US mortgages were in some stage of foreclosure proceedings, and approximately 6.35 percent of homeowners have missed at least one mortgage payment.
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This press release was issued through GroupWeb EmailWire.Com. For more information on unlimited press release distribution service, go to http://www.emailwire.com
www.TheHomeBuyingCenter.com
Patrick McGilvray
916-821-6200
patrick@thehomebuyingcenter.com 
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