John Lounsbury's  Instablog

John Lounsbury
Send Message
John Lounsbury, Managing Editor and Co-founder of Global Economic Intersection, provides comprehensive financial planning and investment advisory services to a small number of families on a fee only basis. He has a background which includes 34 years with a major international corporation, 25... More
My company:
John B Lounsbury CFP
My blog:
Global Economic Intersection
  • Fewer Homes are Under Water 2 comments
    Aug 9, 2010 2:57 PM | about stocks: XHB, XLF, KRE, KBE reports that the percentage of borrowers who owed more on their mortgage than their house is worth fell to 21.5% in the second quarter.  It had been 23.3% in the first quarter.

    Stan Humphries,'s chief economist, said that much of the improvement came from homes falling into foreclosure, wiping away negative equity. 

    At least the relative stabilization of prices associated with the two home purchase tax incentive programs, now ended, prevented many more mortgagors from falling into negative equity status.  With falling demand crushing new home sales the past two months and lower numbers of pending home sales contracts foreshadowing declining existing home sales, there is concern that home prices may start declining again in the coming months.

    A  consequence of a resumption of decline for home prices could see the number of under water home mortgages rising again.

    Source: citing a Reuters article by Julie Haviv

    Disclosure: No positions.
    Stocks: XHB, XLF, KRE, KBE
Back To John Lounsbury's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (2)
Track new comments
  • Mark Bern, CFA
    , contributor
    Comments (7354) | Send Message
    Well, I can just hear all the hype that this will receive. This will undoubtedly be preached as another green shoot. The headlines will tout the drop in the number of homeowners underwater and the foreclosures will get spun into some sort of healing medicine that is finally working, if it is mentioned at all.


    There will be nothing about how the foreclosures will add either to the inventory of houses on the market to be sold or the shadow inventory of banks' REO. The end is not near. Or maybe it is. It depends on which end you're thinking about.
    9 Aug 2010, 11:13 PM Reply Like
  • f851963
    , contributor
    Comments (614) | Send Message
    Mark -- I believe the proper spin will be that, "Fewer homeowners were underwater in the second quarter."
    10 Aug 2010, 08:23 PM Reply Like
Full index of posts »
Latest Followers


More »

Latest Comments

Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.