Underwater Mortgages Still a Problem in Chicago
August 18th, 2010 categories: Chicago Real Estate News
Today’s residential housing market is a mix of good and bad news. Chicago condo and single-family home sales are on the rise, and prices finally seem to be stabilizing. At the same time, the number of housing foreclosures in Chicago remains too high. And far too many homeowners here are underwater on their home loans.
Being underwater is as negative as it sounds. It means you owe more on your mortgage loan than what your residence is worth. A lot of buyers who purchased at the height of the residential real estate boom, 2004 and 2005, for example, are underwater today. That’s because they paid top dollar for their homes, only to see their residences’ values drop steadily ever since.
In the Chicago area, nearly 29 percent of all home mortgage loans were underwater in the second quarter of the year, according to a feature story on ChicagoBreakingBusiness.com.
That’s a high number, but it actually represents a slight improvement from the first quarter of the year. In that quarter, according to real estate Web site Zillow.com, 31.8 percent of mortgage loans in the Chicago area were underwater.
No homeowner wants to be underwater. We all view housing as a type of investment. We expect the value of our homes to grow after we purchase them. We’ve all heard about what a great investment residential real estate is.
Being underwater, though, isn’t a terrible thing if you aren’t planning on selling your Chicago condo or single-family home in the near future. If you don’t have to sell for seven to 10 years, the odds are good, though not guaranteed, that your home’s value will have risen again. Historically, residential real estate has always appreciated over long periods of time.
If you do have to sell your house now, though, and you are underwater? In today’s housing market, you will have to take a loss. By working with a skilled REALTOR® who knows your neighborhood, though, you can at least minimize that loss. A good REALTOR® will help you nab the best possible asking price for your home.
PLEASE CLICK HERE TO VIEW PROPERTIES NOT YET ON THE MARKET.
