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Many Single Family Homes Owners Are Underwater
November 6th, 2009 by 
wsummers
A nationwide study of the housing markets showed that 23 percent of owners of single family homes owe more on their mortgages than the value of their properties in the second quarter of this year.
According to the study, there has been a significant increase in the number of foreclosures for top-tier homes, with 35 percent foreclosure in middle-tier housing and 30 percent in the top-tier and 35 percent in the bottom-tier.
Industry experts noted the dramatic increase in foreclosures and the significant shift to more repossession in the top tier. Last year, top tier homes accounted for 16 percent of foreclosure rates while 29 percent in the middle-tier.
In Hartford, Connecticut, completed sales for single family homes increased by 2.91 percent to 976 in September from 948 for the same month last year. Meanwhile pending home sales also rose by 16.47 percent to 976 in September from 948 for the same month the previous year.
Industry experts said that the increase in home sales last month was probably due to the federal tax credit of $8,000 which is given to first-time homebuyers only. However, the tax credit is set to expire on November 30. They believe that the U.S. Congress should find a way to expand and extend the federal tax credit as a way to maintain the current home sales trend across the country.
On the other hand, while pending and closed sales increased, the median home sale price in Connecticut declined by 4.35 percent to $220,000 from $230,000 the previous year. Also, new listings declined by 9/14 percent while the number of properties on the market dropped by 6.82 percent.
Experts also pointed out that houses are spending more and more time remaining unsold on the market. On the average, a home stays on the market 69 days from 64 days. Additionally, pending sales last month rose by 2.95 percent compared with August while closed sales declined by 6.08 percent.
A sad note was the 6.38 percent drop in the median home price in September compared to the $235,000 the previous month.
Nationwide, over 16 million homeowners have lower home values compared with their mortgages. To qualify for refinancing, lenders are requiring that owners of single family homes cover the cost difference and others.
