I can remember when “under water” meant that you were swimming but now it could mean that you owe more on your home than it is worth. Today Deutsche Bank predicted that almost half of the homes in the United States will notbe worth the value of the mortgage in 2011. In California the prediction is more dire, they say that in 2011 in parts of our fine State that the ratio underwater will be 90%.
What does this mean and is it even possible? Many people are countering this figure and prediction by the fact that home sales are up Nation Wide for the last 5 months. But in certain price ranges and zip codes there is no activity in the high end. In one El Cajon Zip in the $800,000.00 price range not one home has sold for a year.
This seems largely due to both interest in the high end homes and availability of loans in this price range. Don’t think it is only bad in El Cajon. This problem is National and is even impacting our leaders. Our Treasury Secretary, Tim Geithner can not sell his home and resorted to renting it. President Obama’s home has lost a few hundred thousand in value also.
Keeping your chin up and realizing we are all in the same boat is important. Don’t feel isolated everyone is impacted. It is encouraging to see that people are trying new things and are keeping a sence of humor as much as possible.
The number one rule of buying and selling anything is knowing the market. For that reason I provide to my clients both MLS and Public Records Search options. Real Estate professionals not only have to be able to point you to what is available in the Market but what is going to happen to future supply, if it is possible.
I will say this if prices go down any more the market will only continue to get better. Can you imange not wanting to live in San Diego if you could afford to. Our Community could easily lead the Nation out of this slump, we have it all including sun and surf.