Years away from equity
One of the lasting effects of the housing bubble is that millions owe more than their house is worth. So if they sell their house, they still have a mortgage to pay off. With no money in their pocket.
At least they don’t have to worry about capital gains taxes, right?
It’s called “negative equity”, and Nevada leads the country – but other states are close on its heels:
Other bubble states with high levels of negative equity include Arizona (29.2%), Florida (29.2%) and California (27.4%).The second group of states that have a lot of underwater borrowers are in the rust belt region, including Michigan, where 39% of homeowners have negative equity, and Ohio, where that rate stands at 22%.
That second group is a toughie – their problem is broad-based economic deficiencies. Their house value just isn’t going to come back because there are no jobs – therefore, people don’t want to live there.
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November 17th, 2008 at 9:06 pm
The UK is heading dangerously towards negative equity too, with house prices rapidly falling as a result of previous overinflation. Many deposits have been surrendered on off-plan housing because in the time taken to complete the property has dropped so drastically in value.
Amongst the biggest losers are young professional apartments.
I feel for you guys because I don't think its quite 29.2% Good luck to everybody in this position.
November 18th, 2008 at 4:06 am
The UK is heading dangerously towards negative equity too, with house prices rapidly falling as a result of previous overinflation. Many deposits have been surrendered on off-plan housing because in the time taken to complete the property has dropped so drastically in value.
Amongst the biggest losers are young professional apartments.
I feel for you guys because I don't think its quite 29.2% Good luck to everybody in this position.