Rise in Housing Prices Are Making Homeowners Smile
With the rapid rise of house prices over the last 12 months in the San Ramon Valley area, which includes these cities San Ramon, Dublin, Pleasanton, Danville, Alamo and Blackhawk, more homeowners are seeing their home values rise erasing some of the “underwater woes”. We are fortunate in the San Ramon Valley area as we didn’t experience as much a decrease in values as other areas of the Country and the article in “Daily Real Estate News” indicates that all across the Country people are experiencing home prices going up to meet their mortgage debt.
“More Home Owners Have Equity Again”
Daily Real Estate News | Friday, February 22, 2013
“With home prices inching up, more Americans are emerging from being underwater — owing more on their mortgage than their home is currently worth.
Several reports have tried to estimate how many home owners came out from being underwater last year. CoreLogic reported that for the first nine months of 2012, about 1.4 million borrowers moved above water. Zillow recently estimated that 2 million home owners last year emerged from being underwater. And J.P. Morgan Securities reported that the number of underwater home owners fell from 11 million to 7 million last year.
“Estimates can vary for a number of reasons,” The Wall Street Journal reports. “Underwater borrowers can move back to positive equity by paying down their loan principal or by seeing prices rise. Properties can also ‘exit’ negative equity when they go through foreclosure or when the bank approves a short sale. In those cases, borrowers aren’t being returned to positive equity — instead, they simply cease to be borrowers.”
Many of the largest home gains across the country came in areas that had a high number of underwater borrowers. “If this correlation persists in the coming years, the underwater problem could fade much faster than implied by the speed of national house prices appreciation,” Goldman Sachs researchers told The Wall Street Journal.”
As 2013 kicks off all indication are prices are continuing in the upward direction. As an example, average sales prices in San Ramon rose 8% during the month of January as compared to January 2012.
Filed under: Market Data
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