The Recession Won't Be Over Until Home Owners are No Longer Upside Down

I agree Christine, no big ticket items being bought means less jobs and workers.  9% Unemployment is the "new normal" for this crew!

The recession will be over when people have jobs and good health care.  Although some home owners are choosing to walk away, some are losing their homes because they have lost their jobs or been injured and can no longer pay the mortgage. There are also homeowners still in ARM's who may not be able to keep up with the mortgage when the rates go up. Lenders are still difficult to work with on getting the loans modified.

As far as the value of the home being less than what you owe, as long as you don't need to move and still like the home that value number does not matter. Just keep building equity.

Yup, it will be over in more than a few years. this wound will not heal quickly. it is too complicated. nice post.

I agree,

"The Recession Won't Be Over Until Home Owners are No Longer Upside Down" and the private sector is creating jobs.

Too many people cling to the technical description of a recession, and by the technical description it may be over, it may be between double dips, etc.  But by the more meaningful and more subjective standard of how people are feeling about their economic situation, we're in a recession, and I agree that it will last for a fairly long time.

That's not doom and gloom, it's reality.  There are going to be a lot of real estate transactions, and the character of the transactions will continue to reflect the state of the economy by the subjective standard of those struggling in it.

I hope that the american public learns to live within their means. Too often in the past the bills would pile up, the owners would refinance, and then get themselves in trouble again and refinance again. This worked as long as values continued to rise. Some of the public records i've seen show a purchase in 2003 or 2004, a refinance in 2005, a refinance in 2006, a refinance in 2007, even a refinance in 2008, when the lender should have known better, 2009 when the lender definitely knew better, and then a L.P. or N.O.D. in late 2009 or 2010.

Jeffrey's post above is perfect.  Many of the people who are upside down are only in that situation because they pulled false equity out of their homes.  The recession could be deemed as being over when homes are worth at least what their owners paid for them -- not the inflated amounts that some homeowners used as a piggy bank.

I think the recession will be over when the experts say it is over. Of course, it usually takes them about a year to tell us what we've already known. LOL

Home prices zoomed here in San Diego County last month, up $45,000, or 15.8%. Some areas saw prices go up 30-40%, up to $90,000. Just as in the past, those types of numbers won't be sustainable, but we might get back to 2005 levels faster than we think.