roughly 12 million households, or 16%, owe more than their homes are worth, according to Moody's Economy.com. The comparable figures were roughly 4% under water in 2006 and 6% last year.
Among people who bought within the past five years, it's worse: 29% are under water on their mortgages
In the third quarter, mortgage lending fell to the lowest level in eight years -- down 44% in a year -- says the publication Inside Mortgage Finance.
In contrast with the 12 million home borrowers estimated to be under water, ... 24 million households .. own their homes free and clear, and 40 million ... homes remain worth more than is owed on them.
And some slight good news:
In the second quarter, the median home price of about $203,000 was 1.9 times average pretax household income, according to Economy.com. That was close to 1.87 times income for 1985 through 2000, prior to the housing boom.
Just a statistician's guess, but I don't think 1.9 is going to be the bottom. In this economic environment, and with the huge amount of unsold inventory, I would expect the bottom to be below that long-term average -- maybe about 1.7. If that's the case, there's still nearly 20% more of a relative fall to go.
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