These two charts paint a devastating picture of the US housing market.

Its not just that the market value of US residential real estate fell about $6.2 trillion dollars (versus Case Shiller’s 33%) peak to trough fall; the uglier number is the owners equity RE: It is off 55.7% over the same period.

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Market Value US Residential Real Estate

click for bigger graphs

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Owner’s Equity, US Residential Real Estate

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All charts via The Chart Store

Category: Real Estate

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

20 Responses to “Owner’s Equity in Real Estate Down 55.7%”

  1. BennyProfane says:

    I guess it shows you how this “equity” was as illusory as the trillions that Ben is printing these days.

    Or, as Bob Dylan once said, When you ain’t got nuthin’, you got nuthin’ to lose.

  2. Will T says:

    ….and if you consider that roughly 30% of homes have no mortgage, either being paid for in cash or the note has been paid off, owners’ equity for the remaining 70% of homes that have a mortgage is far less than 38.8%. (h/t CR)

    I have no idea how the banks will manage to unvaporize their balance sheets.

  3. holulu says:

    Considering that 32% of home owners do not have mortgage payments, it means that other 67% owners have hardly any equity in their homes. It is terrible.

    If stock market goes down then a typical American is f&^%ked. Some people expect stock market to go down in order to divert money to bond market trying to prevent rates going up we shall see.

  4. trevmillion says:

    Wow – putting those lines on an exponential graphing really makes the dip from 2006 – 2009 look tiny…

  5. Mannwich says:

    Is that bullish for stocks? Isn’t everything now?

  6. OK, So maybe real estate doesn’t always go up

    /snark

    Those numbers are stunning!

  7. Mannwich says:

    @Will T: Answer: QE-free money-4-eva. While real economy whithers on the vine and dies a slow death. Should make the folks in the real world outside of the NYC and DC bubbles very happy, but who cares about them (us)?

  8. Mannwich says:

    @holulu: That’s why they will do ANYTHING to keep the stock market going up for as long as possible, before, of course, they pull the plug again and J6P once he gets in late to the party.

    It’s why we also shouldn’t be shocked to find out the Fed is actually buying stocks as well. My guess is they are when it suits their agenda. Why wouldn’t they at this point? They’ve basically done everything else and have far too much invested to not try everything before all is said and done. You know, the “bazooka”.

  9. Arequipa01 says:

    OT: A friend sent this on today:
    Excerpt from a romance novel?:

    He grasped me firmly but gently just above my elbow and guided me into a
    room, his room. Then he quietly shut the door and we were alone.

    He approached me soundlessly, from behind, and spoke in a low, reassuring
    voice close to my ear.

    “Just relax.”

    Without warning, he reached down and I felt his strong, calloused hands
    start at my ankles, gently probing, and moving upward along my calves slowly
    but steadily. My breath caught in my throat. I knew I should be afraid, but
    somehow I didn’t care. His touch was so experienced, so sure.

    When his hands moved up onto my thighs, I gave a slight shudder, and partly
    closed my eyes. My pulse was pounding. I felt his knowing fingers caress my
    abdomen, my ribcage. And then, as he cupped my firm, full breasts in his
    hands, I inhaled sharply. Probing, searching, knowing what he wanted, he
    brought his hands to my shoulders, slid them down my tingling spine and into
    my panties.

    Although I knew nothing about this man, I felt oddly trusting and expectant.
    This is a man, I thought. A man used to taking charge.
    A man not used to taking `no’ for an answer. A man who would tell me what he
    wanted. A man who would look into my soul and say …

    “Okay, ma’am,” said a voice. “All done.”

    My eyes snapped open and he was standing in front of me, smiling, holding
    out my purse. “You can board your flight now.”

  10. Expat says:

    Dude, again with the negative waves. Why harsh our mellow, man? It’s all good. Just chill and go with it. Remember!
    Debt=wealth
    War=Peace
    Ignorance=Safety
    And the golden shower of piss spraying over you from the Masters of the Universe is really wealth trickling down…ignore their childish giggling.

  11. JohnnyVee says:

    Everything is fine … move along.

  12. obsvr-1 says:

    During the COP testimony today, Geithner was not concerned over the systemic risk from the housing market – not the 100′s $B in HELOC (Second mortages) or the millions of homes in foreclosure or severely delinquent, nor the 1.2T of toxic crap on the FED balance sheet, nor the potential $B’s in mortgage put backs.

    He was confident that the banks were all adequately capitalized to deal with these potential and impending shocks.

    Most likely he was thinking, there is no problem too big for us not to just print our way out of it… after all look at all that money I made on TARP.

  13. gringo says:

    And our government and media continue to promote the fantasy that all that equity will be rushing back into Owners pockets any day now. All we need it the right stimulus or QE3,4,5,6 or maybe 10. How long before people wake up and face the music.

  14. wally says:

    If your house was going to be your retirement, you’re done. If your investments were going to be your reetirement, you’re also done. Good old Social Security is all that remains for many, so naturally there are Congressthieves who want to cut that back. They hate people is why.

  15. dmlopr says:

    Expat, one I’ve my favorites.
    Oddball: To a New Yorker like you, a hero is some type of weird sandwich, not some nut who takes on
    three Tigers.

    Damn, the graphs are butt ugly…How much worse can it get?

  16. Mannwich says:

    @obsvr-1: I saw it for myself on Bloomie TV, Timmy says “TARP to be one of the most effective crisis management programs of all time.” There we have it then. Great job, Timmy.

  17. samglick says:

    Does this mean real estate needs to decline 30% from here to reach the pre-bubble equity level of 60%?

  18. LoriInNC says:

    55% eh? Not to worry…the little people don’t need no stinking equity! All that matters is that the banks have had two record years of profit, so all is good with the world.

  19. hammerandtong2001 says:

    This analysis would benefit significantly from SPECIFICITY.

    There’s no way that 2/3 of home borrowers are down 55% or 66%.

    This is an aggregate analysis, and lumps in crater-jobs like South Florida, with very intact and high income areas like Westchester County, NY.

    What this says to me is this –

    The places where it’s bad — it’s so bad that it’ll take a decade + to dig out. If you bought a condo in a third tier Miami neighborhood for 300K in 2005, then you’re screwed.

    BUT, if you bought a 1.2MM hut in Chappaqua, NY. — you made money.

    Grandma told me when I bought me first house: location, location, location is ALL THAT MATTERS.

    Evidently, it still does.

    .

  20. BennyProfane says:

    @hammerandtong2001

    Well, the simple response is, just try to sell your sweet little “hut” in Chappaqua or Bedford or Armonk and get back to us. I really really doubt you will “make money” on the deal, especially after you factor in the property taxes.
    If you’ve done just a little research, you’ll find out that the market up there is essentially frozen, relative to the good old days. But, everyone is doing just peachy, compared to your other bad locations locations locations around the country, because their financial services jobs have not only been saved by the American taxpayer, but the bonuses are increasing. So, show a little class and stop beating your chest. You may be underwater like the rest of America in a few years if Ben can’t do a QE 7 or something.