19 Reasons Why The Housing Market Will Not Recover Any Time Soon

 1. Robert Shiller, creator of the Shiller index, believes that another 10-25% decline in home prices over the next five years is not out of the question.

2. Case-Shiller data shows another 6-7 million foreclosures to come.

3. According to Case-Shiller data, home prices have fallen 33% since 2006.This is more than the 31% experienced between the late 20’s and early 30’s during the Great Depression.

4. The average homeowner now has 38% home equity. A decade ago, it was 61%.

5. The median price of a new home is back to 2002-03 price levels.

6. New home sales are down 80% since the July 2005 high.

7. Since the housing crisis began, home prices have lost $6.3 trillion in value. No doubt, this amount is increasing.

8. During the first quarter of 2011, fewer new homes were sold in the U.S. than in any 3-month period ever recorded.

9. As of June 2011, more than 4.5 million homeowners are three or more payments behind on their mortgage or in foreclosure. The historical average has been 1 million. Additionally, more than 40% of homeowners who took out second mortgages are underwater on their loans. (negative equity)

10. So far, in 2011,there have been 1.5 million bankruptcies and almost 1 million foreclosures.(U.S. DEBT CLOCK.ORG)

11. The Robo-signing scandal (potentially fraudulent foreclosure affidavits signed off on by lenders without verifying all mortgage related information) is still an epidemic.

12. Deutsche Bank recently projected that by the end of 2011, 48% of homeowners in the U.S. could have negative equity.(owe more on their home than it’s worth)

13. According to the Mortgage Bankers Association, more than 8 million Americans are at least one month behind on their mortgage payments.

14. According to Zillow, the United States has been in a housing recession for 60 months.(8/2006)

15. 3 out of 10 U.S. homes are now sold for a loss.

16. Current home prices continue to decline about 1% per month.

17. 11% of all homes in the United States are vacant. With so many empty houses on the market, there is no reason whatsoever to build new homes.

18. The government now covers 80% of all mortgages.

19. Bank lending/credit standards have tightened considerably; 4 out of 5 loans now require the traditional 20% down payment. The current historic low mortgage interest rates do not matter since most buyers cannot come up with the down payment or qualify for a loan.

“The rebound in prices seen in 2009 and 2010 was largely due to the first-time home buyer’s tax credit. Excluding the results of that policy, there has been no recovery or even stabilization in home prices during or after the recent recession.-David M. Blitzer, Chairman of the Index Committee at S&P Indices

 

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