More Than 20% of Mortgages Under Water

Seattle, WA, May 6, 2009--Falling home values have left more than one fifth of all Americans under water on their mortgages in the first quarter of this year.

Zillow says that 21.9 percent of homeowners owed more on their homes than they are worth. That’s up from  17.6 percent  in the fourth quarter.

Nationwide, foreclosures and short sales remained steady in the first quarter. About one-fifth, or 20.4 percent, of all transactions were foreclosures in the previous 12 months, compared with 19.9 percent in the fourth quarter. Short sales made up 11.9 percent of all transactions in the last 12 months, compared with 10.9 percent in the fourth quarter.

“Slowing declines in select markets are a bright spot – or, at least, what passes for one, given current market conditions, said Stan Humphries, Zillow vice president of data and analytics, in a news release.

However, he added that we’re still many months away from the bottom and an even longer wait before there’s a meaningful recovery in home values.

Meantime, those who are thinking about selling their homes are still holding off until they see better evidence of an improved housing market, according to Zillow.

One-third of all U.S. homeowners said they would be at least somewhat likely to put their home up for sale in the next 12 months, if they saw signs of a recovery. Twelve percent said they would be “very likely” to put their home on the market, eight percent said they would be “likely” and 12 percent said “somewhat likely.”