Underwater Mortgages Drive Prices
Core Logic tells MHProNews.com the reason the supply of homes dropped from a nine month average last June to 6.5 months April 2012 is because there are 11 million borrowers underwater who are unable to unload their homes, which restricts supply and increases the price of existing homes for sale. As HousingWire reports, this is especially true in those markets hardest hit by the housing downturn. In areas where over half of the mortgages are underwater, the average supply is only 4.7 months, compared to better markets where the supply is 8.3 months. Pending sales fell March to April 5.5 percent. On the plus side, lower-priced homes are selling at 4.5 percent higher than a year ago, and at the fastest rate since the homebuyer tax credit of 2010. CoreLogic‘s Sam Khater says he expects the supply to be restricted for some time to come.
(Image credit: ForeclosureSupport)