A new report out by RealtyTrac shows that seriously underwater properties are down by 2.2 million in the US. RealtyTrac defines “Seriously Underwater” homes as those homes where the mortgage value is at least 25% higher than the value of the home.
Why is this significant? Well the obvious answer is that it points to continued improvement in the housing sector. But when you look at it, it’s even more significant because housing is where a lot of industries start. So when you have people that have felt “trapped” in their home for 8, 9 or even 10 years who suddenly realize they may be able to sell their home and move on, it starts a chain reaction. Suddenly you have real estate agents, title & escrow folks, home inspectors, lenders, contractors, landscapers, mortgage professionals all going to work for this homeowner.
A couple of years ago, I pinpointed February of 2012 as the bottom of the housing market for Pierce County, WA. If you looked at the median home value chart for Pierce county, it was a “V” with the peak somewhere around early 2007, a decidedly bleak slide down to February of 2012, then a noticeable rise ever since. While we’re not quite back to peak home prices like many areas of King County are, we’re getting closer. Even this Realtor will find out next week as his home is appraised, if he’s finally back to even!
Barring any new meltdowns in the economy, I’m looking for a tremendous 2015 and beyond. Who’s with me?