Jobs and housing remain the key components to our economic future. Why do I believe we are in for a long and winding road as we navigate the economic landscape? The prospects for real improvements on both these fronts are not positive.
Just this morning, initial jobless claims ratcheted back up to 472k.
In regard to housing, if a picture speaks a thousand words, then the attached pictograph below is a short novel. Despite the information provided here, though, this Wall Street Journal graph does not capture the full picture of our nation’s housing dilemma.
Based purely on this graph, one may think that the state of housing in New York City is actually relatively decent compared to other cities. However, while this graph is outstanding in measuring peak homeownership rates and current levels of equity, it misses the actual volume of homeowners currently in distress.
The Wall Street Journal highlighted these distressed homeowners the other day in writing, Home Loans Are Burden in N.Y. Area,
The New York region has the largest backlog in the country of delinquent mortgages that have yet to move through the foreclosure pipeline, which could weigh on home prices for years, ratings company Standard & Poor’s says.
For years, the foreclosure problem in the U.S. has been associated with cities in Florida, California, Nevada and Arizona. But several communities in New York have seen rising foreclosures, especially in suburban New Jersey and in Queens and Brooklyn. Manhattan has a relatively small number of foreclosures.
At the current rate, it would take 103 months to clear the so-called shadow inventory of loans in the New York area that are more than 90 days delinquent or in foreclosure. That is nearly 3.5 times the national average.
Miami has the second largest backlog with a 62-month supply. Unlike New York, however, Miami’s supply has fallen from a March 2008 peak of 129 months. New York’s backlog has topped 100 months since early 2008.
103 months!! Over 8 years of supply in metro New York!! Combining the details provided in this article with the graph below, how can one be overly optimistic on housing in general and housing in metro New York specifically.