Home » Seriously underwater homes rise, new-home sales tumble
Seriously underwater homes rise, new-home sales tumble
April 23, 2015
WASHINGTON (4/24/15)--For the first time since the second quarter of 2012, the share of seriously underwater homes increased in the first quarter, rising 0.4 percentage points from the fourth quarter, according to RealtyTrac's Home Equity and Underwater report (Housingwire.com April 23).
On an annual basis, however, the share of homes that are seriously underwater is down 4%.
"At the end of 2014, we saw the lowest share of seriously underwater properties since we began tracking such data, but in the first quarter, that share bumped up slightly as home-price appreciation continued to slow down in many markets," said Daren Blomquist, RealtyTrac vice president.
"Most of the seriously underwater homeowners are still stuck in their homes as short sales and other foreclosure alternatives lose momentum, tilting the national home-equity scales back slightly toward a higher share of negative equity," Blomquist added.
Meanwhile, after reports of positive gains in existing-home sales Wednesday, the Census Bureau said Thursday that new-home sales took a nosedive in March.
Sales toppled by 11.4% for the month after climbing by 5.6% in February. Though new-home sales still remain strong on an annual basis, posting a 19.4% year-over-year increase for the month (Economy.com April 23).
"The asymmetry between existing- and new-home sales in March is surprising, but not shocking, as potential homebuyers often turn to existing homes if they judge that new homes are overpriced," said Andres Carbacho-Burgos, Moody's analyst (Economy.com). "Also, new-home sales had been increasing strongly in the past three months, drawing down the number of potential new-home buyers."