Who Lives in a P/i/n/e/a/p/p/l/e House Under the Sea?

[gnomi]

Apparently, lots of people:

Almost a Quarter of US Homeowners Are Underwater

I know it's been raining, but I didn't think it had been *that* bad.

Comments

[goldsquare.livejournal.com]

I read an interesting article this morning on that, as it relates to banking stress tests. It's a little worse than that, for banking purposes.

That number (22%) includes homes that have no mortgage whatsoever.

If you only include homes in the study, that have secured loans against them, the number jumps to 33%.

So, while evaluating the national economy, 22% is very bad. But if you merely evaluate homes with mortgages, 33% are "under water", which means their net equity is negative. They can increase their net worth by abandoning the home, and if they do so, the banks are guaranteed to lose money.

If you, instead, look at how many homes have Loan To Value (LTV) ratios above the 80% mark, the percentage goes up. If I recall, that's close to half of all home owners cannot refinance their mortgages at an 80/20 LTV ratio, which means they do not conform to Fannie Mae/Freddie Mac standards for re-finance.

I'm looking to see if I can find a reliable figure for what percentage of total housing value in the US (all homes value, added together) belongs to banks. As long as housing prices continue to sink, all these numbers get worse.

And while the recent news on housing is that "sales rates have slowed their rate of loss", housing prices are still dropping, nationally - and will continue to do so since so many homes are in foreclosure or pre-foreclosure situations.

[seborn.livejournal.com]

I was expecting to see this subject line as a post about swine flu.