Daily Archives: February 24, 2012
Bedford NY Realtor asks How to Do Keyword Research [Infographic]
Why homes do not sell
price
Mortgage Debt Overhang: Reduced Investment by Homeowners with Negative Equity | Bedford Hills NY Homes
By Bryan Melzer
Kellogg School of Management, Northwestern University
Abstract:
Homeowners with negative equity have less incentive to invest in their property. They face a debt overhang: in expectation, some value created by equity investments in the property will go to the lender. Using rich microdata on household expenditures, I show that debt overhang plays an important role in household financial decisions. I find that homeowners with negative equity cut back substantially on mortgage principal payments, home improvements and home maintenance spending. At the same time, these households show no difference in durable spending on automobiles, furniture and home appliances, investments that are not attached to the home. The decline in mortgage principal payments is particularly large for negative equity homeowners in non-recourse states, where strategic default is more likely because lenders have limited claim on non-housing wealth. Debt overhang, rather than financial constraints, best explains this set of facts. Given the prevalence of negative home equity in today’s housing market, the results suggest that home prices will grow more slowly in the future because of underinvestment. In addition, the potential deadweight loss due to home foreclosures is only part of the economic inefficiency that follows the spree of mortgage borrowing in the 2000s and the subsequent real estate price decline.
Read the report
Survival skills – Wikipedia, the free encyclopedia | Armonk NY Realtor
The number of Homes sold in South Salem NY drops 30% | Sold homes in South Salem NY
The number of homes sold in South Salem NY has dropped 30% over the last six months.
16 homes sold in the last six months ending 2/24/12
23 homes sold in the last six months ending 2/24/11
It remains a buyers market. Price the home right to sell.
Katonah NY real estate sales down 24% | Katonah NY Sold Homes
Home sales dropped 24% in the Katonah real estate market.
19 homes sold for the six months ending 2/24/12
25 homes sold for the six months ending 2/24/11
Sellers need to price right or nothing happens.
Cross River NY real estate sales down 40% | Lewisboro NY Real Estate
Cross River NY Homes sold over the previous six months
3 thru 2/24/12
5 thru 2/24/11
Sales down 40% – Buyers market in Cross River NY