Homeowners tend to walk away and accept foreclosure after a 15% in their home value

REALTOR® Magazine-Daily News-More Owners Walk Away When Underwater

More Owners Walk Away When Underwater
A study of the Massachusetts housing market by researchers from Northwestern University and the University of Chicago concludes that a home owner’s propensity to default increases the further their loan goes under water.

The study found that home owners begin to walk away after declines of 15 percent or more. More than 17 percent of households would default, even if they can afford to pay their mortgage, when the equity shortfall reaches 50 percent of the value of the house.

for more information on walk away plans and walkaway strategy

Wage Deflation in Our Midst | The Big Picture

If there is wage deflation then it will be interesting to if san diego real estate prices can stablize and recover for current levels.

As wages decrease the pool of qualified buyers is likely to shrink.



Wage Deflation in Our Midst | The Big Picture: "A survey conducted by YouGov for the Economist magazine found that 5% of respondents had taken a furlough this year and 15% had accepted a pay cut (see The Recession and Pay: The Quiet Americans on page 33 of this week’s edition).

As wages deflate, workers are looking for ways to supplement their shrinking income base, for example, by moonlighting. Indeed, a poll undertaken by CareerBuilder.com and cited in the USA Today found that one in every ten Americans took on an extra job over the last year; another one in five said they intend to do so in the coming year. These numbers are double for the 45 to 54 year olds who now see early retirement, once around the corner, as an elusive concept."

California Real Estate short sales and price trends

May sales and price report

Existing, single-family home sales increased 35.2 percent in May to a seasonally adjusted rate of
556,590 on an annualized basis.

· The statewide median price of an existing single-family home increased 4.2 percent in May to
$267,570, compared with April 2009.

Inventory on homes priced under 400,000 is very low.
In San Diego many of the lower priced homes are short sales and most of the short sales already have offers.