Hundreds Of Thousands Of U.S. Homeowners Are Now Underwater On Their Mortgages As The Housing Crash Accelerates
Francesco Abbruzzino, The Uncensored Report, LLC
Here we go again. When the housing market crashed in 2008 and 2009, large numbers of U.S. homeowners ended up owing more on their mortgages than their homes were worth. When the Federal Reserve started to aggressively hike interest rates earlier this year, I warned that it would happen again, and now that day has officially arrived. During the third quarter alone, U.S. homeowners lost an all-time record 1.3 trillion dollars in equity as home values plummeted, and a new analysis conducted by Black Knight has found that approximately 450,000 of those homeowners are now underwater on their mortgages…
As the housing market continues to implode – marking a record drop in pending home sales last month amid canceled deals and price cuts, there are around 450,000 homebuyers who owe more than their house is worth as of the end of the third quarter, according to a new analysis from Black Knight. Of those, around 60%, or 270,000, bought their homes in the first nine months of 2022. In total, around 8% of mortgages taken out in 2022 are now marginally underwater, with another 20% having a low equity position.
As I have stated in previous articles, I feel so sorry for those that purchased homes at or near the peak of the market.
If the Federal Reserve continues to raise rates, it won’t be too long before millions of homeowners are underwater on their mortgages, and that would truly be a nightmare scenario.
When you owe much more than your home is currently worth, that makes it exceedingly difficult to sell it.
Ultimately, many homeowners that were underwater on their mortgages in 2008 and 2009 simply defaulted and walked away, and that created enormous headaches for Wall Street.
Right now, we are already in a “housing recession”, and the Federal Reserve is threatening to turn it into a “housing depression”.
Earlier today, we got yet another number that indicates that the housing market is in incredibly bad shape at this moment…
This has been a year of watershed moments in real estate, and not the good kind.
The Housing Market Index, a closely watched industry metric that gauges the outlook for home sales, declined to 33 in November on a hundred-point scale, its lowest level in a decade, save for the first dystopian month of the pandemic. Anything under 50 spells trouble.
14 years after the last housing crash started, another one has arrived.
Interestingly, the housing crash that began in 2008 also began 14 years after the previous one.
In the brand new book that I just released, I have an entire chapter about how the housing crashes have been following a very odd pattern.
And just like 2008, layoffs are starting to surge all over America…
Layoffs are picking up, just in time for the holidays.
At first it was the job-slashing in tech that gobbled up all the attention. From Twitter to Amazon, tech firms have cut more than 146,000 jobs in 2022 after years of seemingly unlimited hiring, according to tracker Layoffs.fyi. Yet with each passing day, the unemployment gloom spreads. It’s reached Wall Street, real estate, crypto, and even the food and beverage industry.
We haven’t seen anything like this since the Great Recession, and one industry that is being hit particularly hard is the media…
