Housing bottoming? Things improving? Worst behind us?
Well, not exactly.
According to a recent Zillow study, the combination of unsold, vacant homes and underwater mortgages will likely pressure the markets further.
“Almost one-quarter of U.S. mortgage holders owed more than their homes were worth in the second quarter and that figure may rise to as much as 30 percent by mid-2010 as job losses and foreclosures climb, Zillow.com said.
Homeowners are being hurt by price declines. The estimated median value for single-family houses slid to $186,500 in the period, a 12 percent drop from a year earlier and the 10th consecutive quarterly decrease, the Seattle-based real estate data service said in a report today…
A glut of unsold homes is also pushing down prices. The 3.8 million homes for sale in June would take 9.4 months to sell at the current pace of transactions, according to the National Association of Realtors. The inventory turnover rate averaged 4.5 months in the six years from 2000 to 2005.
More than 18.7 million homes, including foreclosures, residences for sale and vacation homes, stood vacant in the U.S. during the second quarter. That compared with 18.6 million a year earlier, the U.S. Census Bureau said July 24.”
If you prefer your housing porn in bullet point format, this is lifted directly from the Zillow news release:
• U.S. Home values fell 12.1 percent year-over-year, marking the 10th consecutive quarter of declines
• Q2 was the first quarter where national declines are not growing.
• Total home sales fell 23.7 percent in June versus a year earlier. In the short term, total home sales rose 3.8 percent in June versus May.
• Negative equity: More than one-fifth (23 percent) of all owners of single family homes with mortgages owe more on a mortgage than their home is currently worth.
• Foreclosure re-sales made up 22 percent of all home sales in June.
Homes sold for loss: 29.2 percent of sellers sold homes in June for less than the previous purchase price.
Of course, you can believe the usual NAR releases/MSM articles that ignore seasonality if you want to put a happy face on it . . .
Home Values Flatten in Short Term; Yearly Declines Shrink, but High Rates of Foreclosure, Negative Equity Expected to Delay True Recovery
Zillow, Aug. 11 2009
U.S. Underwater Mortgages May Reach 30%, Zillow Says
Bloomberg, Aug 11 2009