9 cities that can’t seem to recover from the housing crisis
In nine cities in the U.S., more than one in five homeowners owns a home that is seriously underwater (compared with only about one in 10 across the nation) — and few who live in those markets have built up a lot of equity. “Those are markets that have been left behind,” says Daren Blomquist, vice president at real-estate research firm ATTOM Data Solutions.
That’s in contrast to the overall housing market, which is having a solid recovery: As of the second quarter of this year, just 11.9% of homes in America were seriously underwater — meaning that the loan amount for that home was at least 25% higher than the property’s estimated market value — down from more than 13% in the second quarter of last year and roughly 28% at the start of 2012, according to data released Thursday by ATTOM.
What’s more, over 22% of homes are now equity rich, meaning the homeowner has paid down half or more of the value of the home. That’s compared with a little over 18% three years ago.
Home prices are rising rapidly: Data from the National Association of Realtors released in July shows that year-over-year home prices have risen for 52 consecutive months. The median home price in America is now $247,700, up 4.8% from a year prior.
In general, “the storyline is one of recovery,” Blomquist says. “But there are definitely still markets that are not following that standard storyline.”
| 9 housing markets most plagued by underwater mortgages | ||
| Market | Percentage of homeowners who are seriously underwater on their mortgage | Percentage of homeowners who are equity rich |
| Cleveland | 27.5% | 11.8% |
| Las Vegas | 25.7% | 14% |
| Akron | 24.9% | 12.6% |
| Dayton | 24.1% | 10.9% |
| Toledo | 23.6% | 13.1% |
| Chicago | 22.5% | 13.2% |
| Lakeland, Fla. | 21.6% | 15.9% |
| Detroit | 21.3% | 17.6% |
| Kansas City | 21.2% | 10.9% |
| Source: ATTOM Data Solutions | ||
Four of the 9 markets with the most underwater mortgages are in Ohio. Blomquist says many of these spots have a struggling economy and are losing population, which keeps housing prices from rising as rapidly as in other places. Some of the markets — including Las Vegas and Lakeland — had extreme housing bubbles, and thus are taking longer than usual to recover.
Of course, underwater mortgages and high levels of home equity aren’t the only measures of a market’s health. Blomquist explains that home price fluctuations and sales volume — which were not measured in this ATTOM report — are other indicators of the market’s health.
Source: marketwatch.com
Accessibility