Salient to Investors:
- 22 million homeowners lack enough home equity to move, keeping property listings tight and limiting sales as the housing market recovers.
- Values have to climb further to ease the shortage.
- Over 13 million homeowners were underwater in Q1, or 25.4 percent of those with a mortgage. Another 9 million had less than 20 percent equity. Las Vegas and Atlanta have the highest rates of effective negative equity.
- 1.4 million homeowners will regain positive equity by Q1 2014. Of the 30 largest metro areas, the majority of the newly freed homeowners will come from Los Angeles and Phoenix.
- 44 percent of homeowners with mortgages owed more than their properties are worth or had less than 20 percent equity in Q1 2013. Purchasing a new house generally requires equity of at least 20 percent to meet costs such as a down payment and broker fees.
NAR say 2.16 million homes were available in April, the fewest for any April since 2001.
Patrick Newport at IHS Global Insight said people could always buy a smaller house or find a few thousand dollars here or there.
House prices rose 7.2 percent in March from a year earlier – led by the Pacific area and the Mountain region.
Click here to receive free and immediate email alerts of the latest forecasts.