Home Foreclosures in Jacksonville Driven by Negative Equity- By: John Cutts

Description : Home foreclosures in Jacksonville are driven in part by negative equity, based on reports from residential market research firms.

In the final quarter of 2009, over 44 percent of all homeowners with residential mortgages in Jacksonville, Florida were underwater and another 5 percent were nearing the underwater situation. The total number of underwater borrowers was 147,498 and the total number of borrowers approaching negative equity was 16,270.

The negative equity data affirmed a national survey pointing to Jacksonville, Miami and Tampa as having the highest default rates among 28 metropolitan areas surveyed in Florida. This survey also mentioned Jacksonville and Tampa as having the weakest job markets in Florida.

Compared to nationwide data, the negative equity level in Jacksonville was almost double the nationwide share of 24 percent in the final quarter of 2009. A total of 11.3 million borrowers nationwide were underwater, up from the 10.7 million underwater homeowners in the third quarter or 23 percent of all borrowers.

Florida home foreclosures are also driven partly by negative equity, as 48 percent of all mortgaged housing units in the state were underwater in the final quarter of 2009. Florida was third among states in percentage of homeowners with negative equity, behind only Nevada which posted 70 percent and Arizona which posted 51 percent. Michigan and California, followed Florida with 39 percent and 35 percent, respectively.

Home foreclosures in Jacksonville soared by 55.9 percent in 2009 compared to foreclosure activity in 2008 with a total of 26,537 housing units in foreclosure. The figure represented almost five percent of all housing units in the area.

According to economist Mark Fleming, most homeowners with mortgages try their best to salvage their homes, but when the values of their homes plunge by more than 25 percent or about $70,000 below their mortgage amounts, they begin to consider walking away more seriously and just leave their homes to property sales. They figure they can survive foreclosure better than spending much of their monthly income towards mortgage payments.

In January 2009, the sales price median for existing homes in the Jacksonville area fell to $133,990, an almost 14-percent drop. In 2009, the sales price median for existing homes also dropped by 16 percent to $152,200.

The median sales price for distressed properties and home foreclosures in Jacksonville plunged to $89,950 in January this year, a drop of 22 percent from the median price in January 2009.

Article Source : http://www.realestateproarticles.com/

Author Resource : John Cutts has been educated in the finer points of the foreclosure market over 5 years.