” I still don’t see that 17% were leveraged to 90%. You are assuming that every one of those 123,000 was ??
What month is that 123,000 through ? Recent sales haven’t dropped as much.
In any case, well over 80% probably don’t have any problem.
Over 95,000 homes have no mortgage at all.”
123,000 is from January 2005 to July 2007. If national averages apply to SD, they were, on average, leveraged to 91%. I think San Diego should be higher simply because San Diego prices are much higher. In any case, 40% of 123,000 got interest-only or negative amortization loans and I don’t imagine many of those putting any money down at all.
I think the situation is this –
20% of people have their houses paid off completely
40-50% have a lot of equity
15-25% are at risk of going under water (negative equity) if prices decline another 20%
15% are under water already
and “under water” is DEEP under water, because prices are so high. If someone buys a median house with 0 down interest-only at the peak and that house depreciates just 20%, that person is under water for about 2x average annual household income in San Diego. Have things ever gotten so bad during 90’s?
P.S. I screwed up, 123k is 22% of 550k.
P.P.S. There’s also Temecula and Murrieta. That’s where things are really fun. Around 20k new and existing houses sold in 2005-2007 vs. total housing stock of 40-50k houses.
