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Debate House Prices
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US house prices buy a house for $40
Yoshua
Posts: 298 Forumite
http://www.youtube.com/watch?v=upN-tfp_qiE
The Bright Side of the Housing Collapse....You can buy a home for as little as $40 (with payments as low as $0.19 per month!!! if financed)
One in five U.S. mortgage borrowers are underwater
NEW YORK (Reuters) One in five U.S. homeowners with mortgages owe more to their lenders than their properties are worth, and the rate will increase as housing values drop in states that have so far avoided the worst of the crisis, a new study shows.
About 8.31 million properties had negative equity at the end of 2008, up 9 percent from 7.63 million at the end of September, according to the study, released Wednesday by First American CoreLogic. The percentage of "underwater" borrowers rose to 20 percent from 18 percent.
Another 2.16 million properties could go underwater if home prices fall another 5 percent, the study shows.
First American said the value of residential properties fell to $19.1 trillion at year-end from $21.5 trillion a year earlier, with half the decline in California. Forty-three U.S. states and Washington, D.C., were included in the study.
While states such as California, Florida and Nevada were particularly stressed, the study showed worrying signs of deterioration in relatively healthy parts of the nation.
"The economic slowdown is broadening," said Sherrill Shaffer, a banking professor at the University of Wyoming at Laramie and a former Federal Reserve official. "As more people lose jobs, it will be more difficult to sustain the levels of pricing and home ownership, and that is a big factor driving down housing prices in more parts of the country."
Arizona, California, Florida, Georgia, Michigan, Nevada and Ohio remained the most stressed states, with 62 percent of underwater borrowers and just 41 percent of mortgages.
Other areas, though, also face more stress. Connecticut, for example, saw a 25 percent increase in homes with negative equity, while Washington, D.C., had a 44 percent increase.
"Even I continue to be surprised at the tentacles of this financial and economic debacle," said Robert MacIntosh, chief economist at Eaton Vance Management in Boston. "More people are being laid off, resulting in reduced income and therefore less consumption. That leaves fewer people with money to buy homes, and the mentality is that people believe they should wait six months rather than buy now. Less demand means falling prices."
Roughly 68 percent of U.S. adults own their own homes, and about two-thirds of these have mortgages. Many economists expect the nation's unemployment rate to rise above 9 percent before the recession ends, up from January's 7.6 percent.
CALIFORNIA, NEVADA UNDER STRESS
California had 1.9 million borrowers with negative equity at year-end, more than any other state, followed by Florida's 1.28 million. About three in 10 borrowers in both states were underwater.
By other measures, Nevada was the most stressed, with 55 percent of owners having negative equity and borrowers on average owing 97 percent of what their homes are worth. About 28 percent owe more than 125 percent of their homes' value.
Michigan had 40 percent of its homeowners underwater, while Arizona had 32 percent.
New York fared best, with just 4.7 percent of borrowers with negative equity and an average 48 percent loan-to-value ratio, though this could change as employment and bonuses slide in the financial services industry.
According to the S&P/Case-Shiller Home Price Indices, prices of U.S. single-family homes slumped 18.5 percent in December from a year earlier, the biggest drop in the 21-year history of the data.
Many lenders are taking steps to keep borrowers out of foreclosure. The Obama administration has backed legislation that could broaden powers of bankruptcy judges to modify mortgages for troubled borrowers. Among major lenders, only Citigroup Inc has supported such a plan.
MacIntosh expects housing prices to keep falling until "well into" 2010. "There is no magic bullet or magic arrow here," he said. "It is a question of trying to come up with ideas and seeing what happens. It could take a long time."
First American CoreLogic is an affiliate of title insurance and real estate services company First American Corp.
The Bright Side of the Housing Collapse....You can buy a home for as little as $40 (with payments as low as $0.19 per month!!! if financed)
One in five U.S. mortgage borrowers are underwater
NEW YORK (Reuters) One in five U.S. homeowners with mortgages owe more to their lenders than their properties are worth, and the rate will increase as housing values drop in states that have so far avoided the worst of the crisis, a new study shows.
About 8.31 million properties had negative equity at the end of 2008, up 9 percent from 7.63 million at the end of September, according to the study, released Wednesday by First American CoreLogic. The percentage of "underwater" borrowers rose to 20 percent from 18 percent.
Another 2.16 million properties could go underwater if home prices fall another 5 percent, the study shows.
First American said the value of residential properties fell to $19.1 trillion at year-end from $21.5 trillion a year earlier, with half the decline in California. Forty-three U.S. states and Washington, D.C., were included in the study.
While states such as California, Florida and Nevada were particularly stressed, the study showed worrying signs of deterioration in relatively healthy parts of the nation.
"The economic slowdown is broadening," said Sherrill Shaffer, a banking professor at the University of Wyoming at Laramie and a former Federal Reserve official. "As more people lose jobs, it will be more difficult to sustain the levels of pricing and home ownership, and that is a big factor driving down housing prices in more parts of the country."
Arizona, California, Florida, Georgia, Michigan, Nevada and Ohio remained the most stressed states, with 62 percent of underwater borrowers and just 41 percent of mortgages.
Other areas, though, also face more stress. Connecticut, for example, saw a 25 percent increase in homes with negative equity, while Washington, D.C., had a 44 percent increase.
"Even I continue to be surprised at the tentacles of this financial and economic debacle," said Robert MacIntosh, chief economist at Eaton Vance Management in Boston. "More people are being laid off, resulting in reduced income and therefore less consumption. That leaves fewer people with money to buy homes, and the mentality is that people believe they should wait six months rather than buy now. Less demand means falling prices."
Roughly 68 percent of U.S. adults own their own homes, and about two-thirds of these have mortgages. Many economists expect the nation's unemployment rate to rise above 9 percent before the recession ends, up from January's 7.6 percent.
CALIFORNIA, NEVADA UNDER STRESS
California had 1.9 million borrowers with negative equity at year-end, more than any other state, followed by Florida's 1.28 million. About three in 10 borrowers in both states were underwater.
By other measures, Nevada was the most stressed, with 55 percent of owners having negative equity and borrowers on average owing 97 percent of what their homes are worth. About 28 percent owe more than 125 percent of their homes' value.
Michigan had 40 percent of its homeowners underwater, while Arizona had 32 percent.
New York fared best, with just 4.7 percent of borrowers with negative equity and an average 48 percent loan-to-value ratio, though this could change as employment and bonuses slide in the financial services industry.
According to the S&P/Case-Shiller Home Price Indices, prices of U.S. single-family homes slumped 18.5 percent in December from a year earlier, the biggest drop in the 21-year history of the data.
Many lenders are taking steps to keep borrowers out of foreclosure. The Obama administration has backed legislation that could broaden powers of bankruptcy judges to modify mortgages for troubled borrowers. Among major lenders, only Citigroup Inc has supported such a plan.
MacIntosh expects housing prices to keep falling until "well into" 2010. "There is no magic bullet or magic arrow here," he said. "It is a question of trying to come up with ideas and seeing what happens. It could take a long time."
First American CoreLogic is an affiliate of title insurance and real estate services company First American Corp.
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Comments
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I wonder if the American MSE forum had the same chats we did before it all happened
prices to drop by 30%....oh no they won't....oh yes they will.....oh no they...ooopsIf you find yourself in a fair fight, then you have failed to plan properly
I've only ever been wrong once! and that was when I thought I was wrong but I was right0 -
I cant see that ever happening in the UK.
How could prices drop that much surely that would be the end of society as we know it.
It just can not happen Flash Gordy will fix it.0 -
No he won't........ yes he will, oh no maybe not then yes . Fk knows.I came in to this world with nothing and I've still got most of it left. :rolleyes:0
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Does anyone remeber the £1 houses in newcastle around 1998/99When the bloody hell is nelly coming back?0
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The people who bought those houses have made a killing.Does anyone remeber the £1 houses in newcastle around 1998/99
They're worth £1.40 now.Mortgage Feb 2001 - £129,000
Mortgage July 2007 - £0
Original Mortgage Termination Date - Nov 2018
Mortgage Interest saved - £63790.60
ISA Profit since Jan 1st 2015 - 98.2% (updated 1 Dec 2020)0 -
Seriously it wont get as bad as the USA here in the UK.
I would be very surpirsied to see houses less than 50,000 pounds in London.
You will never ever see houses for just hundreds of pounds.
Maybe in some areas you will be able to buy a house for just thousands but not London. Unless we are talking about new build flats the slums of the future then yes maybe you could buy one for hundreds instead of thousands.
But people said same things about the USA and this vid proves them wrong.
But this youtube vid is shocking, I actually have enough money in rapidly depriciating pounds to buy ALL those houses in the USA. But Im waiting for the UK to follow suit..................0 -
I haven't clicked the link but what areas are these in? B-i-L is looking to move and rents are still high-ish in the cities he is investigating.
re prices in London, surely its fair to compare London to NYC, for example- but thats the trick of correctly identifying comparables, no? Its as pointless comparing London and, lets say....Herefordshire, as London and Nevada desert.
Were there really houses in Newcastle for a £1??? Amazing. What happened to them? Do they stand still or were they replaced?0 -
I wonder if the American MSE forum had the same chats we did before it all happened
prices to drop by 30%....oh no they won't....oh yes they will.....oh no they...ooops
I bet the DFW board was quiet. you just walk away in the US.
That is why it would never be the same here, if you are in NE you dont just hand the keys back as you still owe the money.
This then stops the repo presure like in the US.0 -
well, i tried like mad to buy the house i liked and with deposit of 48k i again was refused a mortgage for a house of 238.000..
maybe i ll end up buying a house for 50.000 and have a mortgage of 2000 lol0 -
Can someone tell me these prices are not real?
I just cant believe it0
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