Thursday, July 30, 2009

Home equity at historical lows

The drastic deterioration of home equity is a well known fact, but it's still amazing when one looks at the numbers. Below is a chart from Goldman that shows just how little equity on average people have in their homes. The loan-to-value ratio is at staggering 93%.

This makes it increasingly easy to for the homeowner to walk away from the house.

Non-agency prime mortgages foreclosure rate computed
by Bloomberg:

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