We are officially in the middle of the worst housing collapse in U.S. history - and unfortunately it is going to get even worse. Already, U.S. housing prices have fallen further during this economic downturn (26 percent), then they did during the Great Depression (25.9 percent). Approximately 11 percent of all homes in the United States are currently standing empty. In fact, there are many new housing developments across the U.S. that resemble little more than ghost towns because foreclosures have wiped them out. Mortgage delinquencies and foreclosures reached new highs in 2010, and it is being projected that banks and financial institutions will repossess at least a million more U.S. homes during 2011. Meanwhile, unemployment is absolutely rampant and wage levels are going down at a time when mortgage lending standards have been significantly tightened. That means that there are very few qualified buyers running around out there and that is going to continue to be the case for quite some time to come. When you add all of those factors up, it leads to one inescapable conclusion. The "housing Armageddon" that we have been experiencing since 2007 is going to get even worse in 2011.
Wednesday, February 2, 2011
The Worst Housing Collapse in U.S. History
Posted by Nick
My mom lost her house to a wildfire in 2003. She didn't rebuild. Instead she used the insurance money to buy a house in a more upscale neighborhood, only that meant that she now couldn't buy the house outright. She would still owe about $300,000 on it. When she realized the housing boom was coming to an end, and the mortgage payment was a little too high for her to maintain, she put it up for sale. Only it didn't sell...not right away. She finally had a buyer, though, an enormously fat couple with big fat kids and several huge dogs. They either had money to burn, or they thought that housing prices would keep rising forever (suckers!) cause they bought the place (and proceeded to tear out all the beautiful vegetation in the backyard, including the avocado, orange and lemon trees-"hey, our dogs need room to run"). That was in 2006. The housing boom had reached its peak. My mom didn't want to make another mistake, so she got outta Dodge and bought elsewhere, only after the collapse of the housing market, she discovered the new house was worth less than what she'd paid for it. She put it up for sale, obviously hoping a couple of dumb fatsos would come along again, but the obese family she was looking for didn't show up and it didn't sell. She was "asking too much" the real estate agents told her, even though she was asking for less than she'd bought it for. She's decided to stay there. A nice family across the street put their house up for sale as well. It also didn't sell. They were foreclosed on by the bank. A house around the corner on the next street has had a "for sale" sign in front going on two years now...
Housing Armageddon: 12 Facts Which Show That We Are In The Midst Of The Worst Housing Collapse In U.S. History