Troubled homeowners who get a break from their mortgage lenders could
face a hefty tax bill next year if a key provision expires at the end
of the year, though state laws could determine which borrowers will have
to write a check to Uncle Sam.
Homeowners who live in states where mortgages are non-recourse—that
is, where they aren’t personally liable for the unpaid balance—may avoid
the potential tax hit even if Congress doesn’t act, according to a letter sent by the Internal Revenue Service released by Sen. Barbara Boxer (D., Calif.) on Friday.
The tax provision currently allows some homeowners—mostly those
facing foreclosure—to avoid paying taxes on certain relief that they
receive on their mortgages. The IRS considers debt forgiveness to be a
form of taxable income. That means homeowners who sell their homes for
less than the amount they owe in a short sale could face a tax bill.
In 2007, as the foreclosure crisis spread, Congress exempted some
homeowners from counting certain kinds of forgiven mortgage debt as
taxable income in order to encourage banks and borrowers to seek
foreclosure alternatives. Congress retroactively extended the provision
earlier this year, after it expired on Dec. 31, 2012. The provision is
set to expire this coming Dec. 31 and there appears to be less urgency
in Congress right now to pass an extension.
In the letter to Sen. Boxer, the IRS clarified that certain
non-recourse debt forgiven by lenders wouldn’t typically be considered
taxable income by the IRS. This means that for most California
borrowers, the expiration of the tax provision may not have a meaningful
effect.
“California homeowners have struggled through years of economic
hardships during the Great Recession,” said Ms. Boxer in a statement
Friday. “I am relieved that these families will not face a burdensome
tax penalty just as they are trying to rebuild their lives with a short
sale.”
In the letter, the IRS wrote that “if a property owner cannot be held
personally liable for the difference between the loan balance and the
sales price, we would consider the obligation a non-recourse
obligation.” As a result, the owner would not have to count that
forgiven debt as income.
Other states with laws that prevent lenders from seeking so-called
“deficiency judgments” to recoup defaulted debts from borrowers would
likely be in the same camp as California, the letter said.
Short sales have fallen sharply as a share of overall sales over the
past year as the housing market has rebounded and fewer homeowners have
found themselves underwater. In California, short sales accounted for
around 12.6% of homes that were resold last month, down from 26.7% one
year earlier, according to research firm DataQuickMDA.T +0.82%.
Nationally, lenders have approved more than 200,000 short sales this
year through August, according to Hope Now, an industry coalition to
promote foreclosure alternatives.
Monday, November 18, 2013
Wednesday, October 16, 2013
Monday, September 30, 2013
Full-blown housing recovery remains an illusory goal
A full-blown housing recovery could push the nation closer to full
employment, but a confluence of factors have made this an illusory goal,
researchers claim in a new report from Moody’s Analytics and the Urban Institute.
As home prices rise, rates increase and investors step away from the market, the recovery becomes even more dependent on the return of move-up and first-time homebuyers, says analysts Jim Parrott and Mark Zandi, both of whom published a research paper on mortgage credit, titled “Opening the Credit Box.”
The only problem is many of these buyers are not ready to sign onto a mortgage, or they are not allowed to get a mortgage due to stringent underwriting guidelines.
Parrott and Zandi’s statistics show first-time homebuyers struggling as affordability disappears and tighter lending standards block them from the mortgage market altogether.
The good news is housing starts doubled from the Great Recession to current levels, rising from 500,000 units per year during the crux of it, to 900,000 units. Prices are also up 15% from two years ago, Parrott and Zandi said.
But credit remains tight, with the average credit score on purchase loans hovering at 750 – 50 points above the average credit score a decade ago.
Lenders and borrowers are caught on a type of dangerous carousel, where they are unable to break free of current market trends due to pending litigation and regulatory risk, changing market dynamics and fears built into the system on both sides.
"First, lenders have reassessed how much risk they are willing to take on, in part because they were burned badly in the crisis and in part because they have come to recognize a range of costs associated with riskier lending not fully appreciated before: the increased cost of servicing distressed borrowers; the reputational and legal risks associated with servicing significant numbers of delinquent or defaulting loans; and a similar range of risks associated with originating loans that subsequently default, to name but a few," the two researchers noted in their report.
Lenders also were able to stay active and financially viable for years by focusing on refinancing – a market that is starting to cool, making the pivot to purchase loans essential, but difficult.
Lenders are also worried about loan putbacks – or requests from the GSEs asking lenders to repurchase loans with underwriting mistakes or issues.
"Lenders are only willing to make loans intended for purchase by Fannie or Freddie or insurance by the FHA if there is little prospect of default, so that they do not expose themselves unwittingly to the risk that they will bear the cost," the report concluded.
Parrott and Zandi say the goal is to strike a balance between access to credit and safe lending, without resorting to excessive risk-taking.
The average household receiving a Fannie/Freddie purchase mortgage had a FICO score of 766 in June. A decade ago, that score would have been 50 points lower. Current FHA borrowers have an average credit score of 700 and above, which is also 50 points higher when compared to normal market cycles.
As home prices rise, rates increase and investors step away from the market, the recovery becomes even more dependent on the return of move-up and first-time homebuyers, says analysts Jim Parrott and Mark Zandi, both of whom published a research paper on mortgage credit, titled “Opening the Credit Box.”
The only problem is many of these buyers are not ready to sign onto a mortgage, or they are not allowed to get a mortgage due to stringent underwriting guidelines.
Parrott and Zandi’s statistics show first-time homebuyers struggling as affordability disappears and tighter lending standards block them from the mortgage market altogether.
The good news is housing starts doubled from the Great Recession to current levels, rising from 500,000 units per year during the crux of it, to 900,000 units. Prices are also up 15% from two years ago, Parrott and Zandi said.
But credit remains tight, with the average credit score on purchase loans hovering at 750 – 50 points above the average credit score a decade ago.
Lenders and borrowers are caught on a type of dangerous carousel, where they are unable to break free of current market trends due to pending litigation and regulatory risk, changing market dynamics and fears built into the system on both sides.
"First, lenders have reassessed how much risk they are willing to take on, in part because they were burned badly in the crisis and in part because they have come to recognize a range of costs associated with riskier lending not fully appreciated before: the increased cost of servicing distressed borrowers; the reputational and legal risks associated with servicing significant numbers of delinquent or defaulting loans; and a similar range of risks associated with originating loans that subsequently default, to name but a few," the two researchers noted in their report.
Lenders also were able to stay active and financially viable for years by focusing on refinancing – a market that is starting to cool, making the pivot to purchase loans essential, but difficult.
Lenders are also worried about loan putbacks – or requests from the GSEs asking lenders to repurchase loans with underwriting mistakes or issues.
"Lenders are only willing to make loans intended for purchase by Fannie or Freddie or insurance by the FHA if there is little prospect of default, so that they do not expose themselves unwittingly to the risk that they will bear the cost," the report concluded.
Parrott and Zandi say the goal is to strike a balance between access to credit and safe lending, without resorting to excessive risk-taking.
The average household receiving a Fannie/Freddie purchase mortgage had a FICO score of 766 in June. A decade ago, that score would have been 50 points lower. Current FHA borrowers have an average credit score of 700 and above, which is also 50 points higher when compared to normal market cycles.
Monday, September 9, 2013
Some jumbo loans are now even cheaper than conforming mortgages!
With mortgage rates rising to levels not seen for two years, it's
hard work finding a great deal on a home loan — unless you're rich
enough to need a jumbo mortgage.
These loans on steroids certainly aren't for everyone: Jumbos are defined as mortgages over $625,500 in much of California and more than $417,000 even in places where homes are cheap.
But if you can qualify, America's banks stand ready to reward you with a rate nearly as good as or even better than what you can get for a normal loan. This is an unprecedented situation because jumbos historically have come at a premium price, said Brad Blackwell, executive vice president of No. 1 mortgage lender Wells Fargo Home Mortgage.
"This is a new phenomenon — something we've never seen before," Blackwell said in an interview.
Freddie Mac said Thursday that lenders were offering non-jumbo 30-year fixed-rate loans to solid borrowers at an average of 4.57%, up from 4.51% last week and a recent low of 3.35% in May. The borrowers would have paid 0.7% of the mortgage amount in upfront lender fees to obtain the rates.
Rates for 15-year fixed mortgages and adjustable loans also rose, a trend attributed to stronger growth in the gross domestic product and positive surveys on manufacturing and home building.
These loans on steroids certainly aren't for everyone: Jumbos are defined as mortgages over $625,500 in much of California and more than $417,000 even in places where homes are cheap.
But if you can qualify, America's banks stand ready to reward you with a rate nearly as good as or even better than what you can get for a normal loan. This is an unprecedented situation because jumbos historically have come at a premium price, said Brad Blackwell, executive vice president of No. 1 mortgage lender Wells Fargo Home Mortgage.
"This is a new phenomenon — something we've never seen before," Blackwell said in an interview.
Freddie Mac said Thursday that lenders were offering non-jumbo 30-year fixed-rate loans to solid borrowers at an average of 4.57%, up from 4.51% last week and a recent low of 3.35% in May. The borrowers would have paid 0.7% of the mortgage amount in upfront lender fees to obtain the rates.
Rates for 15-year fixed mortgages and adjustable loans also rose, a trend attributed to stronger growth in the gross domestic product and positive surveys on manufacturing and home building.
Wednesday, September 4, 2013
FANNIE MAE TO FIX GLITCH THAT HARMS SOME CONSUMERS' CREDIT
Because of a shortcoming in Fannie Mae’s software, many homeowners who sold their homes through short sales have suffered undue harm to their credit and additional penalties preventing them from attaining new mortgage loans for several years, according to Sen. Bill Nelson (D-Florida), who has been working toward a solution to the problem.
Monday, August 26, 2013
CALIFORNIA HOME SALES HIGHER IN JULY; PRICE GAINS CONTINUE BUT TAPERING
LOS ANGELES (Aug. 16) – California’s housing market bounced back after a
slight dip in June to reach the highest level since May 2012, as home
prices continued to post strong annual gains and home sales recorded the
first annual increase in six months, the CALIFORNIA ASSOCIATION OF
REALTORS® (C.A.R.) reported.
“The spike in interest rates in June prompted home buyers to delay escrow closings in hopes that rates would fall back,” said C.A.R. President Don Faught. “As buyers recognized rates had stabilized, they moved forward to close escrow, which lifted July’s sales from both the previous month and year.”
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 443,520 units in July, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. Sales in July were up 7 percent from a revised 414,670 in June and up 1.5 percent from a revised 436,870 in July 2012. The year-to-year sales increase was the first since December 2012, following six consecutive months of declines. The statewide sales figure represents what would be the total number of homes sold during 2013 if sales maintained the July pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
The statewide median price of an existing, single-family detached home inched up 1.2 percent from June’s median price of $428,620 to $433,760 in July. July’s price was 29.8 percent higher than the revised $334,220 recorded in July 2012, marking 17 straight months of annual price increases and the 13th consecutive month of double-digit annual gains. The median sales price is the point at which half of homes sold for more and half sold for less; it is influenced by the types of homes selling as well as a general change in values.
“A constrained supply of homes over the past year has fueled robust home price increases, particularly in the coastal regions,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “Looking ahead, we should continue to see strong price growth but at a less accelerated pace than what we’ve experienced over the past year. Inventory levels are starting to build in some areas as price gains free up previously underwater homes and encourage homeowners reluctant to list because of the scarcity of homes to purchase.”
“The spike in interest rates in June prompted home buyers to delay escrow closings in hopes that rates would fall back,” said C.A.R. President Don Faught. “As buyers recognized rates had stabilized, they moved forward to close escrow, which lifted July’s sales from both the previous month and year.”
Closed escrow sales of existing, single-family detached homes in California totaled a seasonally adjusted annualized rate of 443,520 units in July, according to information collected by C.A.R. from more than 90 local REALTOR® associations and MLSs statewide. Sales in July were up 7 percent from a revised 414,670 in June and up 1.5 percent from a revised 436,870 in July 2012. The year-to-year sales increase was the first since December 2012, following six consecutive months of declines. The statewide sales figure represents what would be the total number of homes sold during 2013 if sales maintained the July pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.
The statewide median price of an existing, single-family detached home inched up 1.2 percent from June’s median price of $428,620 to $433,760 in July. July’s price was 29.8 percent higher than the revised $334,220 recorded in July 2012, marking 17 straight months of annual price increases and the 13th consecutive month of double-digit annual gains. The median sales price is the point at which half of homes sold for more and half sold for less; it is influenced by the types of homes selling as well as a general change in values.
“A constrained supply of homes over the past year has fueled robust home price increases, particularly in the coastal regions,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “Looking ahead, we should continue to see strong price growth but at a less accelerated pace than what we’ve experienced over the past year. Inventory levels are starting to build in some areas as price gains free up previously underwater homes and encourage homeowners reluctant to list because of the scarcity of homes to purchase.”
Thursday, August 22, 2013
Home Flipping Reaches Highest Level in July Since 2005
A new report from PropertyRadar found that home flipping – defined as reselling a property within six months – reached its highest level in July since September 2005. Flipping has steadily increased since January 2012 due to the increase in profit potential in a market where housing prices are on the rise.
A new report from PropertyRadar found that home flipping – defined as reselling a property within six months – reached its highest level in July since September 2005. Flipping has steadily increased since January 2012 due to the increase in profit potential in a market where housing prices are on the rise.
Monday, June 24, 2013
Market Statistics and Valuable Marketing Tool
Market Statistics and Valuable Marketing Tool
The month of May was an unusually sunny month; we rarely had a May-Gray Day. With the
great weather, the buyers continued their quest for their dream homes. The market is as
energetic as ever!
The number of closed escrows of homes and PUDs (houses) was higher this month compared to
last May. Reviewing the year-to-date data, more homes have sold so far this year than they have
for the last decade in the same time frame. There is a 10% increase in the number of houses sold
compared to last year’s year-to-date data.
The condominium market has also seen increases. Comparing to last May, there is over 4%
increase in sales for the month. The current year-to-date number of condos sold is 177, which is
the highest since 2005 when there were 189. There is an 18% increase in sales compared to last
year at this time.
So far this year, 231 houses sold that are over $1,000,000 price range. This is almost a 41%
increase over the number sold last year by the end of May. Looking at the over $10,000,000
range, there have been five sales this year which is comparable to last year at this time. Two
years ago, however, there were none.
Very comparable to last year, there have been 10 condo sales of $1,000,000 or higher. The
highest condo sale was for $2,250,000.
Median price for houses is $879,500 for the month of May. It is a bit down from last month but
is 10% higher than last May. From a year-to-date standpoint, the median price is $890,000
which is over 13% higher than a year ago. Looking at our median price graph, you can see that
the current median is somewhere between the 2003 and 2004 ranges. There is a definite upward
trend compared to the last few years.
For condos, the median price is $470,000 for the month of May. This is also down from a month
ago, but it is almost 4% higher than last May.
Multiple offers are still prevalent in this market. An incredible 38% of the closed house listings
sold over their list price at the time of sale. Typically over-asking prices occur when a multiple
offer situation exists. Another interesting note is that 17% of the closed listings sold at asking
price. Overall, the percentage of sold price to list price is over 97% for the month of May.
For condos, 26% of the closed listings in May were sold over the list price and 36% of the
listings sold at list price. The percentage of sold price to list price for condos is over 98%.
The lack of inventory is still an issue. A year ago, there were 390 houses available for sale,
which was considered low at that time. Now there are only 299. With this low amount, there
are only 2.2 months of inventory, which means it would take that amount of time to sell the
available inventory. Last year, there were 107 condos available for sale at the end of May; now
there are 56 and that represents only 1.1 months of inventory for condos. Looking further at the
chart, note that the area around Goleta has actually less than a month’s worth of inventory.
For the last few years, distressed properties have dominated the real estate news and were a good
portion of the inventory. It appears that this tide has turned. In May, only 12% of the closed
sales on houses were distressed properties compared to a year ago in which it was closer to 33%.
For condos in May, there were only two short sales and no bank-owned properties sold.
Of the current available houses, only five are short sales and four are bank-owned properties. For
available condos, three are short sales and one is bank-owned that are available. Reviewing the
current pending house sales (those that are in escrow), 12% of these are short sales and less than
4% are bank-owned properties. For pending condo sales, 6% are short sales and 6% are bankowned
properties.
A Valuable Marketing Tool for Sellers
If you should list your property for sale, you should understand that one of the best tools real
estate agents have for getting the highest and best price is by having them put the information in
the local Multiple Listing Service (MLS). This is an excellent way to get broad exposure for
your property. Listing a property in the MLS exposes it to all real estate agents who participate in
that MLS, which exposes it to all of their current and potential clients. The seller has the option
to allow that information to be disseminated on the Internet so it will appear on multiple sites:
local, national and international. Many properties have been sold based on the information found
on the Internet and most of today’s buyers search the Internet for available properties.
The choice to list your house on the MLS and the Internet are choices you as the seller should
make. If a seller chooses not to put their house in the MLS, it is important that they understand
the potential ramifications of that choice. First, it will drastically lower the exposure the house
will receive. It may result in a longer time frame for the potential sale. Additionally, it may sell
for a lower price than if it had been more widely exposed.
Some of the reasons why a seller may not to want to have their properties on the MLS are valid,
but there may be options in which the property can still be put in the MLS. One of the reasons is
privacy. Sellers may not want people to see the inside of their house. If this is the case, the
seller can indicate that they do not want pictures published in the MLS. They can also control
ways in which their home will be shown. But by placing it in the Multiple Listing Service they
will have insured that all agents with prospective buyers will know about their property.
If a seller has tenants in the property but does not want them to be disturbed, there are a number
of things that can be done. A “Do Not Disturb Occupant” rider can be added to the For Sale
sign. The agent can also state in the public and private remarks that no one should go on the
property without the listing agent.
Some sellers may not want to have their home in the MLS because they may not want their
neighbors to know that they are moving. Once the home is in the Multiple Listing Service,
neighbors will definitely notice a lot of extra activity around the seller’s house. At the same
time, the address can be left out of the Internet submission.
There are other reasons that may affect a seller’s decision to withhold their property from the
MLS, and the seller should discuss their reasoning with their real estate agent. No agent should
ever make that decision for a seller, nor should an agent advise a seller to keep a property out of
the MLS unless it is clearly in the best interest of the owners of the home.
Once you have decided to sell your home, meet with your REALTOR® and discuss what the
best option is for you. Make an informed decision that insures the best possible price for you in
your current circumstances.
If you are a planning to either buy or sell a property, it would be prudent to call a local
REALTOR® to assist you through the process.
The month of May was an unusually sunny month; we rarely had a May-Gray Day. With the
great weather, the buyers continued their quest for their dream homes. The market is as
energetic as ever!
The number of closed escrows of homes and PUDs (houses) was higher this month compared to
last May. Reviewing the year-to-date data, more homes have sold so far this year than they have
for the last decade in the same time frame. There is a 10% increase in the number of houses sold
compared to last year’s year-to-date data.
The condominium market has also seen increases. Comparing to last May, there is over 4%
increase in sales for the month. The current year-to-date number of condos sold is 177, which is
the highest since 2005 when there were 189. There is an 18% increase in sales compared to last
year at this time.
So far this year, 231 houses sold that are over $1,000,000 price range. This is almost a 41%
increase over the number sold last year by the end of May. Looking at the over $10,000,000
range, there have been five sales this year which is comparable to last year at this time. Two
years ago, however, there were none.
Very comparable to last year, there have been 10 condo sales of $1,000,000 or higher. The
highest condo sale was for $2,250,000.
Median price for houses is $879,500 for the month of May. It is a bit down from last month but
is 10% higher than last May. From a year-to-date standpoint, the median price is $890,000
which is over 13% higher than a year ago. Looking at our median price graph, you can see that
the current median is somewhere between the 2003 and 2004 ranges. There is a definite upward
trend compared to the last few years.
For condos, the median price is $470,000 for the month of May. This is also down from a month
ago, but it is almost 4% higher than last May.
Multiple offers are still prevalent in this market. An incredible 38% of the closed house listings
sold over their list price at the time of sale. Typically over-asking prices occur when a multiple
offer situation exists. Another interesting note is that 17% of the closed listings sold at asking
price. Overall, the percentage of sold price to list price is over 97% for the month of May.
For condos, 26% of the closed listings in May were sold over the list price and 36% of the
listings sold at list price. The percentage of sold price to list price for condos is over 98%.
The lack of inventory is still an issue. A year ago, there were 390 houses available for sale,
which was considered low at that time. Now there are only 299. With this low amount, there
are only 2.2 months of inventory, which means it would take that amount of time to sell the
available inventory. Last year, there were 107 condos available for sale at the end of May; now
there are 56 and that represents only 1.1 months of inventory for condos. Looking further at the
chart, note that the area around Goleta has actually less than a month’s worth of inventory.
For the last few years, distressed properties have dominated the real estate news and were a good
portion of the inventory. It appears that this tide has turned. In May, only 12% of the closed
sales on houses were distressed properties compared to a year ago in which it was closer to 33%.
For condos in May, there were only two short sales and no bank-owned properties sold.
Of the current available houses, only five are short sales and four are bank-owned properties. For
available condos, three are short sales and one is bank-owned that are available. Reviewing the
current pending house sales (those that are in escrow), 12% of these are short sales and less than
4% are bank-owned properties. For pending condo sales, 6% are short sales and 6% are bankowned
properties.
A Valuable Marketing Tool for Sellers
If you should list your property for sale, you should understand that one of the best tools real
estate agents have for getting the highest and best price is by having them put the information in
the local Multiple Listing Service (MLS). This is an excellent way to get broad exposure for
your property. Listing a property in the MLS exposes it to all real estate agents who participate in
that MLS, which exposes it to all of their current and potential clients. The seller has the option
to allow that information to be disseminated on the Internet so it will appear on multiple sites:
local, national and international. Many properties have been sold based on the information found
on the Internet and most of today’s buyers search the Internet for available properties.
The choice to list your house on the MLS and the Internet are choices you as the seller should
make. If a seller chooses not to put their house in the MLS, it is important that they understand
the potential ramifications of that choice. First, it will drastically lower the exposure the house
will receive. It may result in a longer time frame for the potential sale. Additionally, it may sell
for a lower price than if it had been more widely exposed.
Some of the reasons why a seller may not to want to have their properties on the MLS are valid,
but there may be options in which the property can still be put in the MLS. One of the reasons is
privacy. Sellers may not want people to see the inside of their house. If this is the case, the
seller can indicate that they do not want pictures published in the MLS. They can also control
ways in which their home will be shown. But by placing it in the Multiple Listing Service they
will have insured that all agents with prospective buyers will know about their property.
If a seller has tenants in the property but does not want them to be disturbed, there are a number
of things that can be done. A “Do Not Disturb Occupant” rider can be added to the For Sale
sign. The agent can also state in the public and private remarks that no one should go on the
property without the listing agent.
Some sellers may not want to have their home in the MLS because they may not want their
neighbors to know that they are moving. Once the home is in the Multiple Listing Service,
neighbors will definitely notice a lot of extra activity around the seller’s house. At the same
time, the address can be left out of the Internet submission.
There are other reasons that may affect a seller’s decision to withhold their property from the
MLS, and the seller should discuss their reasoning with their real estate agent. No agent should
ever make that decision for a seller, nor should an agent advise a seller to keep a property out of
the MLS unless it is clearly in the best interest of the owners of the home.
Once you have decided to sell your home, meet with your REALTOR® and discuss what the
best option is for you. Make an informed decision that insures the best possible price for you in
your current circumstances.
If you are a planning to either buy or sell a property, it would be prudent to call a local
REALTOR® to assist you through the process.
Tuesday, March 19, 2013
'Underwater' homes decline nationwide, report says
A shortage of houses on the market has pushed up home prices in many
markets, including California. But the supply could increase, cooling
price increases, if more homeowners escape negative equity positions and
regain the option of selling.
“The scourge of negative equity continues to recede across the country,” CoreLogic Chief Executive Anand Nallathambi said in a statement. “With fewer borrowers underwater, the fundamentals underpinning the housing market will continue to strengthen.”
The inability of homeowners to sell and move -- say, for a better job -- also places a drag on the overall economy.
In California, an estimated 1.7 million homes were underwater at year's end, or about a quarter of all homes with a mortgage. The Riverside-San Bernardino-Ontario metropolitan area had 35.7% of its homes with a mortgage in negative equity — the fifth-highest percentage among the country’s largest metropolitan areas.
“The scourge of negative equity continues to recede across the country,” CoreLogic Chief Executive Anand Nallathambi said in a statement. “With fewer borrowers underwater, the fundamentals underpinning the housing market will continue to strengthen.”
The inability of homeowners to sell and move -- say, for a better job -- also places a drag on the overall economy.
In California, an estimated 1.7 million homes were underwater at year's end, or about a quarter of all homes with a mortgage. The Riverside-San Bernardino-Ontario metropolitan area had 35.7% of its homes with a mortgage in negative equity — the fifth-highest percentage among the country’s largest metropolitan areas.
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