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 marie@beninatiassociates.com, 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.
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