Chicago Homeowners Trying to Stay Afloat with Underwater Mortgages

June 01, 2012

Homeowner swimming under HouseThis writer hates to be the bearer of bad news, but given the current Chicago real estate climate, there is simply no way around it. While I would love to write that Chicago is in the middle of a booming housing market, I have to remind myself that we are dealing with fact and not fiction. So without further ado, let’s get down to the nitty gritty.

The percentage of homeowners who are underwater on their mortgage is… (cue Star Wars Imperial Death March theme) growing!

According to Inman News, the percentage of homeowners with mortgages who owe more than their homes are worth continued to rise during the first quarter of 2012. Yet, only 1 in 10 of homeowners currently underwater are seriously delinquent on their loans according to Zillow.

There has been an increase in the amount of underwater homes for the first three months of the year. Stats show that 15.7 million, or 31.4 percent of all homes with mortgages, were underwater. This is an increase compared to 31.1 percent for the final three months of last year.

The scary part? While only 10 percent of underwater homeowners are more than 90 days behind on their payments, this could equal roughly 1.6 million homes hitting the market as distressed properties in the future.

For the first quarter of 2012, 41.1 percent of Chicagoland homeowners were underwater on their mortgage, up from 39.2 percent for the last quarter of 2011. Chicago homeowners who were delinquent 90 days or more for the first quarter of 2012 came out to 12.7 percent.

These stats, while depressing, should offer a ray of hope for one group of people in real estate: Landlords.

About The Author

Read All Stories By Mitch Levinson

Mitch Levinson is the author of “Internet Marketing: The Key to Increased New Home Sales” published by BuilderBooks. He is an Internet marketing expert with expertise in search engine optimization, website development, email marketing, social media and CRM consulting services. He is known for creating effective programs that can be tracked through analytics to prove effectiveness and ROI. Mitch is founder and president of MLC New Home Marketing and MLC FlatFee Realty, as well as managing partner of mRELEVANCE, LLC, a Marketing, Communication, Interactive agency with offices in Chicago and Atlanta. He currently leads the Chicago team. A Multi-Million Dollar Sales Producer who earned an MBA in Computer Information Systems and eCommerce, he brings a unique perspective and experience to the field of real estate communications. Mitch combines the two interests in order to help home builders and developers gain a competitive advantage through the Internet and technology. When he isn’t behind a computer, he enjoys participating in sports and coaching his kids’ teams. Mitch resides in Arlington Heights, Ill., a northwest suburb of Chicago, with his family, which includes two rambunctious labs. Visit my Google+ profile.

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