Real Estate Wealth Effect Hurts US
Falling home values have stopped homeowners from taking a family vacation this summer, completing a home improvement project or making a big purchase depressing the overwhelming majority of Americans, according to a new Housing Predictor opinion poll.
The impact of the “Wealth Effect” related to the real estate crash is being felt by homeowners, who are cutting out vacations at the beach or mountains, a trip abroad, buying a boat and other big purchases. More than 3 out of 4 homeowners are making sacrifices and it’s effecting the way they feel about themselves with more than one out of four owing more on their home than it’s valued at in the current marketplace. Home values are still declining in the majority of markets.
The HousingPredictor.com survey clearly indicates that the large majority of Americans are directly affected by the drop in home values. The foreclosure crisis is pressuring home values in all but four states. Less than one out of four surveyed said they were not impacted by declining real estate values known as the Wealth Effect.
Many areas of the U.S. have seen home values decline five years, including the hardest hit states like California, Florida, Nevada, Ohio and Michigan. But states that weren’t widely marketed ALT-A and subprime mortgages are doing much better in terms of coping with the fall-out of the crash, many of which are listed in the updated best 25 Housing Predictor market list.
Housing Predictor regularly surveys visitors to its website on important issues related to real estate to get a pulse on how consumers feel and forecasts more than 230 local housing markets in all 50 U.S. states and keeps visitors up to date on real estate news and mortgage rates.
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- Mike Colpitts
- Housing Predictor
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