Foreclosure Rising in High-End Housing
The foreclosure crisis is increasingly affecting homes across the value spectrum, with the highest tier accounting for twice as many foreclosures now compared to five years ago, according to a new study.
During the first half of the decade, homes valued in the top-third of a community represented a small portion of foreclosures‒typically around 15%. Today, that category of home make up nearly 30% of foreclosures, according to data collected by Zillow.com.
Homes in the bottom and middle thirds of communities represented 55% and 30% of foreclosures five years ago, respectively. Today, those categories represent 35% of foreclosures each, creating a housing market where foreclosures are evenly distributed across all classes.
According to the Wall Street Journal, foreclosures are rising among the upper tiers of homes because the housing crisis has left more homeowners with “underwater” mortgages, causing homeowners to walk away from their mortgages.
Subprime mortgages, on the other hand, are accounting for fewer foreclosures. A year ago, half of foreclosure defaults were on subprime loans; today, only half.
Foreclosure & Bankruptcy
Anecdotal data shows that areas with high foreclosure rates also have high personal bankruptcy rates. Nevada, Michigan, Florida and California rank among the highest states in both categories.
nora
15 Oct, 2009
The number of foreclosures rising is scaring me, i am afraid of a second wave, do you think this is possible?
Jacob Christensen
21 Oct, 2009
I think yes, nora… We only see rising numbers!
Chris Kramer
21 Oct, 2009
Yes, the experts are saying the foreclosure will continue to rise throughout 2010. Unemployment as well. Lots of banks are still working through two-years’ worth of defaults, which won’t help, either.