AP: Homeowner Equity Is Lowest Since 1945

[El Pinko]

http://biz.yahoo.com/ap/080306/home_equity.html



AP
Homeowner Equity Is Lowest Since 1945
Federal Reserve Report Shows Homeowner Equity Dipping Below 50 Percent, the Lowest on Record

Thursday March 6, 2:15 pm ET
By J.W. Elphinstone, AP Business Writer

NEW YORK (AP) -- Americans' percentage of equity in their homes fell below 50 percent for the first time on record since 1945, the Federal Reserve said Thursday.

Homeowners' portion of equity slipped to downwardly revised 49.6 percent in the second quarter of 2007, the central bank reported in its quarterly U.S. Flow of Funds Accounts, and declined further to 47.9 percent in the fourth quarter -- the third straight quarter it was under 50 percent.

That marks the first time homeowners' debt on their houses exceeds their equity since the Fed started tracking the data in 1945. The total value of equity also fell for the third straight quarter to $9.65 trillion from a downwardly revised $9.93 trillion in the third quarter.

Home equity, which is equal to the percentage of a home's market value minus mortgage-related debt, has steadily decreased even as home prices jumped earlier this decade due to a surge in cash-out refinances, home equity loans and lines of credit and an increase in 100 percent or more home financing.

[El Pinko]

1. Good morning.

Kicking because I posted this so late.