Posted on Thursday, November 11, 2010
Forty-two percent of homes in South Florida were under water in the third quarter, down from 43.2 percent in the previous quarter and 45.1 percent a year ago, according to Seattle-based Zillow.
Still, that’s nearly double the national negative equity rate of 23.2 percent.
Home values in Miami-Dade, Broward and Palm Beach counties in the third quarter fell 15.2 percent, year-over-year, and 4.2 percent, quarter-over-quarter.
By comparison, nationwide home values fell 4.3 percent, year-over-year, and just 1.2 percent, quarter-over-quarter, according to Zillow, which considers all home values and not just sales prices when determining its estimate.
The average value of all homes in the South Florida area was $143,300 in the third quarter, significantly less than the nationwide figure of $179,900.
“The high percentage of homeowners in negative equity continues to be troubling, in that it represents a huge number of people who are not only more vulnerable to foreclosure, but who are essentially trapped in their current homes and are prevented from selling and buying a new home,” Zillow Chief Economist Stan Humphries said in a news release. “This has profound implications for future demand and will be a millstone around the neck of the housing market.”
South Florida home values have fallen 53.3 percent from their peak in June 2006, and are at the level they were in July 2002.
Of those homes that sold in the third quarter, 45.9 percent sold for a loss, up from 44.5 percent a quarter ago, but down from 46.7 percent a year ago. Nationwide, 27.3 percent of all homes sold for a loss.
Foreclosures reached an all-time high at the end of the third quarter, with more than one out of every 1,000 homeowners nationwide losing their homes to foreclosure in September.
“While not unexpected, the unceasing declines in home values signal that we’re in for a long, bleak winter of continued troubles for the housing market,” Humphries said. “The length and depth of the current housing recession is rivaling the Great Depression’s real estate downturn and, with encouraging signs fading, will easily eclipse it in the coming months.
South Florida Business Journal