Housing still in trouble - and why?

[c1ue]

http://www.msnbc.msn.com/id/27089919/?ref=patrick.net

The relentless slide in home prices has left nearly one in six U.S. homeowners owing more on a mortgage than the home is worth, raising the possibility of a rise in defaults — the very misfortune that touched off the credit crisis last year.

About 75.5 million U.S. households own the homes they live in. After a housing slump that has pushed values down 30 percent in some areas, roughly 12 million households, or 16 percent, owe more than their homes are worth, according to Moody's Economy.com.
The comparable figures were roughly 4 percent underwater in 2006 and 6 percent last year, says the firm's chief economist, Mark Zandi, who adds that "it is very possible that there will ultimately be more homeowners underwater in this period than any time in our history."

In contrast with the 12 million home borrowers estimated to be underwater, 64 million have equity in their homes. These include 24 million households who own their homes free and clear, and 40 million whose homes remain worth more than is owed on them.

So of the 75.5M who own a home, 51.5M have mortgages.

Of those, nearly 1/4 are already underwater.

Hmmmm!

[grapejelly]

Re: Housing still in trouble - and why?

it's like 3 trillion or more that would have to be "injected" to cover this deficit...and if housing prices continue to fall, still more. There is not enough real cash in the world to do this.

Countrywide is just trying to pretend that a borrower's loan is okay by doing a "loan modification" for just about anyone...even if there is not a prayer that the borrower will honor the newly modified loan. Then they do another loan mod. And another. For the same borrower.