In early 2012, 31.4% or 15.7 million U.S. homeowners, had negative equity - where the value of their home was less than their existing mortgage. This was the peak level which resulted from the 2008 market collapse. Approximately, one in three homes had mortgages that exceeded the estimated selling price, clearly making it impossible to sell without financial loss.
At the close of 2016, that percentage dropped to 10.5%, about a two-thirds drop from 2012 and 2.6% lower than 2015. This means that today, one in ten home-owners with a mortgage are underwater (they owe more than the value of their home). The good news is that, “more than 1.2 million American homeowners with a mortgage were freed from negative equity in 2016. Currently, about 5.1 million homeowners nationwide are underwater, roughly one-third the total number of underwater homeowners at the peak of the negative equity crisis.”*
In Suffolk County, at the close of 2016, the percentage of homes with negative equity was slightly higher than the national average at 11.4% while the percentage of homes with equity of 20% or less (effective negative equity) was 24.6%. This number is significant for our local market, since it holds back potential sellers for listing their homes, because there may not be enough equity in their existing home to cover a down payment for a new home and closing and moving costs.
If you wish to sell your home or property but feel you are in a negative equity situation, it may be a good time to get an update on the market and a current market analysis for your property. Call us, 631 765 5333, or email me at firstname.lastname@example.org, we will give you a detailed analysis of your property value at our expense. We have had amazing results these first two months of 2017! the left! Call us, you’ll get an honest and thoughtful assessment to help you make an informed decision.
* Source: Q4 2016 Negative Equity Report: Improvement Continues, But at a Much Slower Rate, Svenja Gudell, Chief Economist at Zillow, March 7, 2017.