We’re certainly not all about doom and gloom but if you listen to Karen Weaver, global head of Deutsche Bank‘s securitization research division, then we might be in this real estate mess for more than some people think or say. Weaver recently said that 48% of U.S. mortgage owners will be upside down (end up owing more than their home is worth) by 2011.
How’s that possible? Haven’t many pundits climbed that we’ve hot bottom? Look closer at the numbers that show a startling 27% of U.S. homeowners with an “underwater” mortgage and according to Deutsche Bank, home prices may fall another 14% before hitting a bottom. Ouch.
Some estimates claim that 14 million homeowners have negative equity. However, based on Deutsche Bank’s home price forecast, as prices continue to fall (and unemployment continues to rise) they think that number could reach 25 million, or 48% of all mortgagors. Like Luca Brasi a lot of poeple will “sleep with the fishes”.