Five States Account for 31% of Underwater Mortgages
Here’s another sign that the housing market keeps getting healthier: More than 250,000 formerly underwater homes regained equity in the first quarter of 2015, according to CoreLogic, meaning that the value of the homes rose above the value of the mortgages on them.
Borrower equity grew more by $694 billion in the quarter, and more than 90 percent of mortgaged American homes now have equity. Such a surge in homeowner wealth has historically led to increased consumer spending and investment.
“Many homeowners are emerging from the negative equity trap, which bodes well for a continued recovery in the housing market,” Anand Nallathambi, president and CEO of CoreLogic said in a statement. “With the economy improving and homeowners building equity, albeit slowly, the potential exists for an increase in housing stock available for sale, which would ease the current imbalance in supply and demand.”
Related: 9 Real Estate Trends to Watch in 2015
Still, 5.1 million mortgaged homes remain underwater, representing 10.2 percent of all mortgaged properties. Five states — Nevada, Florida, Illinois, Arizona and Rhode Island — account for nearly a third of all properties with negative equity. As of the end of the fourth quarter, 10.8 percent of homes — or about 5.4 million properties — were underwater.
The number of underwater homes has decreased year-over-year by 1.2 million and the aggregate value of negative equity has fallen 13 percent to $337.4 billion.
Texas was the state with the fewest underwater properties; 98 percent of homeowners there with a mortgage have equity in their homes.
Just under 20 percent of homes with a mortgage are considered “under-equitied,” meaning that they have less than 20 percent equity and would likely have trouble refinancing their property or obtaining new financing to sell their home and buy another.
A 5 percent increase in home values nationwide would bring another million homeowners into positive equity territory, CoreLogic economists predict.
Quote of the Day - October 16, 2017
Speaking at a cabinet meeting on Monday, President Trump said:
"Obamacare is finished, it's dead, it's gone ... There is no such thing as Obamacare anymore."
Click here for the video.
Poll: Trump Tax Cuts Favor the Wealthy; Deficit Should Be Higher Priority
Trump and the GOP still have work to do if they want to convince Americans that their tax plan won’t mostly help the rich. A CBS News Nation Tracker poll released Sunday finds that 58 percent say the tax reforms being discussed favor the wealthy, while 19 percent say it treats everyone equally and 18 percent say it favors the middle class.
The poll also found that 39 percent say that cutting the deficit should be a priority, even if it means taxes stay the same. About half as many people said cutting taxes should be prioritized even if the deficit rises.
The poll, conducted by YouGov, surveyed 2,371 U.S. adults between October 11 and 13. Its margin of error is 2.5 percent.
Coporate Tax Cut Could Be Phased In
House tax writers (at least some of them) are worried that slashing the corporate tax rate found will push the deficit higher in a hurry – an analysis by the Tax Policy Center found that cutting the rate to the stated goal of 20 percent would cost $2 trillion over a decade. One way to soften the fiscal blow would be to phase in the reduction over three to five years. House Republicans say such an approach would reduce the size of the lost revenue by half.
Larry Summers: GOP Tax Claims Are 'Made-Up'
Former U.S. Treasury Secretary Lawrence Summers isn't happy with the Republican tax plan, and it's not just because he has a different set of ideas as a Democrat. More fundamentally, he says Republicans are making false claims: “When you have -- and I hate to be in a position of using this word about our government -- when you have senior economic officials making claims that are made-up ... it’s very hard to have a dialogue, and compromise, and get to a good place.”
Summers is also worried about the effects of a tax cut for the rich during a time of considerable social turmoil: “There’s a lot of unhappiness and anger out there … It’s really hard to see why focusing a corporate tax cut on those at the very high-end is going to do much to assuage that anger.”
How Much Did Mike Pence’s NFL Walkout Cost Taxpayers?
Vice President Mike Pence’s decision to attend an NFL game between the Indianapolis Colts and San Francisco 49ers yesterday and then leave after some 49ers players kneeled during the national anthem was quickly criticized by some as a planned piece of political theater — and a somewhat expensive one at that. “After all the scandals involving unnecessarily expensive travel by cabinet secretaries, how much taxpayer money was wasted on this stunt?” Rep. Adam Schiff (D-CA) tweeted Sunday afternoon.
The answer, CNN reports, is about $242,500: "According to the Air Force, flying a C-32, the model of plane used for Air Force 2, for one hour costs about $30,000. Pence's flight from Las Vegas to Indianapolis Saturday took about three hours and 20 minutes, so it cost about $100,000. Pence then flew from Indianapolis to Los Angeles on Sunday, which took about four hours and 45 minutes, costing about $142,500."
President Trump defended Pence’s trip, tweeting that it had been “long planned.” CNN also reports that some of the costs of Pence's flight from Indianapolis to Los Angeles will be paid back by the Republican National Committee because the vice president is attending a political event there.