Texas Gal Real Estate » Real Estate

TEXAS EXISTING HOME SALES DROP IN FEBRUARY

Adminkl — Wed, 30 Mar 2011 16:32:32 +0000

Here’s more good news for Texas, of course those of us that have our houses up for sale know this already!

COLLEGE STATION (Real Estate Center) – Just over 12,000 existing single-family homes was sold in Texas last month, a 10 percent drop from February 2010. That’s according to the most recent Multiple Listing Services (MLS) data compiled by the Real Estate Center at Texas A&M University.

The median home price in Texas was up 3 percent from February 2010, at $145,800. There was a 7.2-month inventory.

February 2011 MLS data for many Texas cities (current as of today) are available on the Center’s website. Here is a sampling:

	Sales	Change from Last Year	Median Price	Change from Last Year	Months’ Inventory
Abilene	91	down 2%	$110,000	up 12%	6.2
Austin	1,214	down 3%	$190,000	up 4%	5.9
Bay Area	334	up 6%	$153,200	up 4%	9.8
Beaumont	108	no change	$116,700	down 16%	10.7
Brazoria County	54	down 17%	$115,000	down 6%	9.7
Collin County	604	down 9%	$205,200	up 4%	5.1
Dallas	2,390	down 14%	$158,700	up 6%	6.6
Fort Worth	464	down 19%	$107,200	down 3%	6.9
Houston	3,603	down 2%	$151,900	up 4%	7.5
Longview- Marshall	113	down 3%	$124,300	up 4%	9.4
Montgomery County	372	up 2%	$179,100	up 5%	7.3
Port Arthur	36	down 20%	$126,700	up 35%	11.6
San Antonio	1,100	down 12%	$146,400	up 3%	7.9
Texarkana	51	down 18%	$110,000	down 16%	9.2
Waco	107	down 11%	$118,600	up 4%	9.3
Texas	12,008	down 10%	$145,800	up 3%	7.2

February Existing-Home Sales Decline following Sustained Gains

Adminkl — Tue, 22 Mar 2011 16:41:29 +0000

Washington, DC, March 21, 2011

WASHINGTON (March 21, 2011) – Existing-home sales fell in February following three straight monthly increases, according to the National Association of REALTORS®.

Existing-home sales¹, which are completed transactions that include single-family, townhomes, condominiums and co-ops, dropped 9.6 percent to a seasonally adjusted annual rate of 4.88 million in February from an upwardly revised 5.40 million in January, and are 2.8 percent below the 5.02 million pace in February 2010.

Lawrence Yun NAR chief economist, expects an uneven recovery. “Housing affordability conditions have been at record levels and the economy has been improving, but home sales are being constrained by the twin problems of unnecessarily tight credit, and a measurable level of contract cancellations from some appraisals not supporting prices negotiated between buyers and sellers,” he said. “This tug and pull is causing a gradual but uneven recovery. Existing-home sales remain 26.4 percent above the cyclical low last July.”

A parallel NAR practitioner survey² shows first-time buyers purchased 34 percent of homes in February, up from 29 percent in January; they were 42 percent in February 2010.

All-cash sales were a record 33 percent in February, up from 32 percent in January; they were 27 percent in February 2010. Investors accounted for 19 percent of sales activity in February, down from 23 percent in January; they were 19 percent in February 2010. The balance of sales were to repeat buyers.

The national median existing-home price³ for all housing types was $156,100 in February, which is 5.2 percent below February 2010. Distressed homes – sold at discount – accounted for a 39 percent market share in February, up from 37 percent in January and 35 percent in February 2010. “The decline in price corresponds to the record level of all-cash purchases where buyers – largely investors – are snapping up homes at bargain prices,” Yun explained. “We’d be seeing greater numbers of traditional home buyers if mortgage credit conditions return to normal.”

NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said buyers should look into loan availability as soon as they decide they want to buy. “Despite very affordable mortgage interest rates, credit remains a challenge – buyers should check their personal credit, and mortgage availability in their area,” he said.

“REALTORS® are an excellent resource to learn about all of the marketplace factors, but in this tight credit environment it’s important to learn up front what a lender might be willing to offer as well as specific programs that might be available in your location,” Phipps said.

Total housing inventory at the end of February rose 3.5 percent to 3.49 million existing homes available for sale, which represents an 8.6-month supply⁴ at the current sales pace, up from a 7.5-month supply in January.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.95 percent in February from 4.76 percent in January; the rate was 4.99 percent in February 2010.

Single-family home sales fell 9.6 percent to a seasonally adjusted annual rate of 4.25 million in February from 4.70 million in January, and are 2.7 percent below the 4.37 million pace in February 2010. The median existing single-family home price was $157,000 in February, which is 4.2 percent below a year ago.

Existing condominium and co-op sales dropped 10.0 percent to a seasonally adjusted annual rate of 630,000 in February from 700,000 in January, and are 3.1 percent lower than the 650,000-unit level one year ago. The median existing condo price⁵ was $150,400 in February, down 11.1 percent from February 2010.

Regionally, existing-home sales in the Northeast fell 7.2 percent to an annual pace of 770,000 in February and are 8.3 percent below February 2010. The median price in the Northeast was $230,200, down 9.5 percent from a year ago.

Existing-home sales in the Midwest dropped 12.2 percent in February to a level of 1.01 million and are 9.0 percent lower than a year ago. The median price in the Midwest was $122,000, which is 5.4 percent below February 2010.

In the South, existing-home sales fell 10.2 percent to an annual pace of 1.84 million in February but are unchanged from February 2010. The median price in the South was $134,600, down 3.9 percent from a year ago.

Existing-home sales in the West declined 8.0 percent to an annual level of 1.26 million in February and are 2.4 percent below a year ago. The median price in the West was $190,000, which is 5.2 percent below January 2010.

The National Association of REALTORS®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.

# # #

NOTE: NAR also tracks monthly comparisons of existing single-family home sales and median prices for select metropolitan statistical areas, which is posted with other tables at: www.realtor.org/research/research/ehsdata. For information on areas not included in the report, please contact the local association of REALTORS®.

What is My Home Worth?

Adminkl — Tue, 22 Mar 2011 16:11:30 +0000

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Ten Reasons Why Texas is a Great Place to Live

Adminkl — Thu, 10 Mar 2011 18:38:38 +0000

Excerpt from Texas Magazine, As a true Texan that I am, I am very proud of my state and I thought this was too good not to share!

Texas real estate has never been out of the news ever since the national real estate bubble burst and led to a series of collapses which mired the world in its first global financial crisis. Because Texas had always had realistic prices when it came to Texas homes and Texas properties and a tradition of coupling it to good value Texas Realtors experienced a slump but not a drop to the level of all the other states or indeed (if we start looking globally) countries.

Whether you are an out of State real estate investor looking to put some money into real, solid value, now that the Stock Exchange is not looking so attractive, or an international buyer looking for a Texas Lakeside Home or a Texas recreational property or even a local Texan looking to grab a bargain the chances are that the Lone Star State has got something that will grab your attention.

Here at Texas Real Estate magazine we see a lot of the properties that go on the market and get a more spherical view of what is happening which is why we know why Texas is such a great deal when it comes to finding real estate.

Let’s look at some of the most important reasons a Texas home will more than give you your money back:

1. Texas is a place of beauty - Texas tends to be the big country. Wide open spaces, blue skies, friendly people and a culture
which in itself offers variety, history and a sense of depth.

2. Texas Real Estate offers good value – Texas homes and Texas ranches have always been priced at a median level when compared to real estate in any other part of the country. This meant that they always offered more room for growth in terms of price and, when the credit crunch came, they did not slump in value the way real estate did everywhere.

3. Texas offers variety – Texas is probably unique in its mix of surf and turf – lakeside views, homes by scenic rivers and ranches or recreational properties near mountains and ragged terrain.

4. Texas is close to nature – If you like the outdoor life and are ready to escape the rat race Texas will welcome you. Whether it’s
fishing by a Texas river, whitewater rafting down some fast ravine or taking to rough terrain with a recreational vehicle Texas offers the kind of big country spaces and natural landscapes that you see only in films, unless you are in Texas.

5. Texas is culturally diverse – The mixed, diverse cultural backgrounds of Texas which combine the much older traditions of
neighbouring Mexico with the unique blend of values brought over by European settlers make for an approach to social and business meetings which is purely Texan.

6. Texas offers value – The Texan approach to real estate reflects the down-to-earth, principled way of doing business which Texas is justly famous for. It makes for a realistic approach to life and this is reflected in real estate. Texas homes and Texas properties tend to be realistically priced and offered on a strict value-added basis.

7. Texas is great for investment – if you are looking to buy real estate with an eye for its future value then Texas is the location of choice. With many out-of-state and international buyers moving into the Lone Star State to buy real estate the value of Texas property and its ability to appreciate with time have been tested time and again.

8. Texas is friendly – whether it’s a US president or a guy down at the ranch, Texans are famed for their folksy wisdom, down-to-earth approach to problems and their friendliness. The so-called ‘Texas spirit’ is indicative of a certain underlying philosophy to life which often augurs well.

9. Texas has a strong economy – during the oil crisis of 2008 the Texas economy and its oil-based profits grew and grew. It is not just oil driving the growth of the state forward however. Texas is so large that it still has massive potential for development and growth and it is this which is being realised in the 21st century. Texas real estate is one of the powerful engines driving growth in the state, for instance, and there are others ranging from tourism to business ideas.

10. Texas is the place of big business – whether you are in the State for some pleasure or are looking to invest in Texas property the Texan economy is ear-marked by the fact that it does not do things by halves. Texans are not afraid to think big and act big. The Alamo, happening so early in a nascent State’s history, was no accident. It reflects a spirit that is huge in itself, never considering anything ‘impossible’ until it’s first tried.

Texas is a great place to live, fantastic when it comes to investment and fabulous as a place to do business in. Texas Real Estate magazine is your starting point for anything which has to do with finding the perfect Texas home or Texas ranch.

The Texas Real Estate magazine news articles are put together by an expert team of real estate and finance analysts who use both anecdotaland hard data to look at the indicators within the market and make predictions or buck trends.

Discussion on Foreclosures

Adminkl — Thu, 10 Mar 2011 17:52:44 +0000

Insight on the real estate market across the United States, with Russel
Haraus, Appraisal Research Counselors, and our own Steve Haines, Texas
Real Estate Magazine, and Leslie Erickson, Prudential Georgia Realty.

How real estate and the economy will fare in 2011

Adminkl — Thu, 10 Mar 2011 00:36:16 +0000

Economists Mark Dotzour and James P. Gaines of the Real Estate Center at Texas A&M University share their insights.
After falling every year since 2006, the number of homes sold in 2010 seems to be have stayed close to 2009 levels.

Do you think the market has hit bottom? When the final counts come in, Texas home sales in 2010 will be down 6%-7% from the 2009 level. The homebuyer tax credit moved a great deal of demand into the first half of the year, but left the second half soft. Monthly sales volume was down at least 14% every month since June. The recent foreclosure mess caused sales to decline, as fewer distressed properties were brought to market, and has probably pushed recovery further into the future.

The outlook for at least the first half of 2011 is not encouraging. Interest rates are creeping up and job formation, while positive, is not strong enough yet to fuel significant recovery. The second half of 2011 holds promise. With luck—and assuming no other major shocks to the real estate system—2011 overall should be about the same as 2010 statistically and reflect a turning point toward meaningful recovery during the next couple of years.

The recovery, though, will be slow as mortgage credit remains tight and buyers’ attitudes toward homeownership adjust. Sales velocity as measured by the number of transactions per 1,000 households continues to revert to its long-term normal level of around 20 sales per 1,000, from 24.5 per 1,000 in 2010.

What factors will affect sales volume in 2011?

The primary factor affecting 2011 sales will be job growth. We need better than 2% annual rate of increase to stimulate new household formation and to encourage buyers to enter the market. Not only will the total number of jobs created be important, but also the incomes and permanence associated with new jobs. If all new jobs are temporary, low-income positions, the impact on housing will be fairly minor.

The major factor that will retard sales growth will be the mortgage credit market. Lenders face an unenviable situation: On one hand, the government is encouraging institutions to create new home loans and even threatening punishment for not doing so. On the other hand, the banking regulators come down hard, requiring higher reserves on all new real estate loans added to a lender’s portfolio. Fortunately, Texas is one of the few states actually creating jobs and creating a positive atmosphere toward home buying. The rental market has also picked up in the past couple of years, making the acquisition of some problem properties attractive to investors, adding to the potential sales volume.

How will prices trend in Texas in 2011?

The median home price in Texas did very well in 2010 by comparison to the rest of the country. The state median price will end the year (2010) slightly ahead of 2009, and expectations now are that 2011 prices will continue to be steady with perhaps a slight increase. In today’s economic climate, avoiding a price decline is a positive.

How long can interest rates stay this low?

As 2010 ended, monthly mortgage interest rates had begun to rise from the unprecedented levels of the past 12 months. The Fed right now seems dedicated to keeping interest rates low to stimulate economic activity, including housing. But risk has returned to the investment and capital markets as a very real factor, which means that as the year progresses, we should expect interest rates to rise. The pace of increase and the magnitude, again barring some unforeseen event or shock to the system, should be gradual on both counts.

Increasing interest rates in 2011 could have some surprising effects. If buyers expect rates to increase, it may encourage some to buy sooner rather than later—just as if they expected home prices to increase. The restraint, of course, will be the ability of those buyers to qualify for a loan.

What’s the most vulnerable part of the residential real estate market?

One thing is fairly certain: The two most significant issues facing the housing market are the potential for an economic relapse and fragile buyer expectations. Housing is not fueling the economic recovery as it has during past recessions. Today, housing is dependent upon general economic improvement for its own recovery. The government stimulus programs for housing have so far only delayed any real recovery and provided modest help to distressed homeowners or those who would like to be homeowners.

By the end of 2010, most economic indicators pointed toward a slow improvement in the overall economy. Private-sector jobs were being created, GDP was positive, consumer spending was growing, and corporate profits were up. But general economic improvement so far is extremely fragile. Any number of problems could emerge to disrupt it, such as global financial crises, state and local government budget deficits creating more unemployment, stagnant consumer and business spending causing erosion in small to-medium-sized businesses, and massive uncertainty about the impact of past and future government policies and programs.

Consumer expectations play a substantial role in housing, too, and today’s buyer expectations are as fragile as the economy. Their expectations about future home prices, interest rates, and their ability to qualify for loans will influence and ultimately determine the direction of the 2011 market. Many view today’s market problems as significant opportunities, while others see current conditions and decide that now is not the time to make a major investment. Long-term, homeownership has always proved beneficial, but as with most things, decisions today are made in the short-term.

What indicators should agents look for to judge the direction of their local markets?

There will be major differences in conditions among Texas markets and even within local markets. Sales volume and sales by price segment will be key factors along with new construction. Local permitting data can be watched. There will probably be little new development, so most new construction will be in existing communities.

Price trends are always important. Locally, price-per-square-foot may be as meaningful as overall averages and medians. If price-per-square-foot stays competitive with replacement cost, this will not bode well for new construction.

Foreclosures and distressed sales may play a significant role in local housing markets. The first half of 2011 may be especially vulnerable to influence from foreclosures as the foreclosure moratoria are relaxed, releasing more properties that were postponed.

Local lending practices need to be closely watched, and agents need to stay especially alert for indications that mortgage credit underwriting is changing. Qualifying buyers will be especially difficult this coming year, so any changes in attitudes and actions by lenders need to be followed closely. And, of course, local job creation will be a must-watch for everybody to gauge real market improvement potential.

How will the state’s budget crisis affect the real estate market?

It’s difficult to determine what effects the state’s budget problems will have on the housing market until we know what actions are to be taken. Two of the major anticipated impacts are the level of state employment and the pass through problems to local school districts. The state may be able to address some of its budget problems without major layoffs of currently employed workers. Attrition and hiring freezes may be able to handle the personnel cost issues. Local school districts, which rely on the state for more than 50% of their funding, will have much more difficult decisions.

Mark Dotzour, Ph.D, is chief economist and James P. Gaines, Ph.D, is research economist at the Real Estate Center at Texas A&M University.

Visit the center’s Web site, www.recenter.tamu.edu, for more information.

Nearly 25 Percent Of All Mortgages Delinquent, 230 Percent Increase

Adminkl — Wed, 23 Jun 2010 15:58:39 +0000

So if all this is true, where is Obama getting his information from?

Excerpts from a recent Mortgage Bankers Association Press Release….

Nearly 25% Of All Mortgages Delinquent, 230% Increase/ 2011 Real Estate Market Predictions

The delinquency rate for mortgage loans on one-to-four-unit residential properties increased to a seasonally adjusted rate of 10.06 percent of all loans outstanding as of the end of the first quarter of 2010, an increase of 59 basis points from the fourth quarter of 2009, and up 94 basis points from one year ago, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey. The non-seasonally adjusted delinquency rate decreased 106 basis points from 10.44 percent in the fourth quarter of 2009 to 9.38 percent this quarter.

The percentage of loans on which foreclosure actions were started during the first quarter was 1.23 percent, up three basis points from last quarter but down 14 basis points from one year ago.

The delinquency rate includes loans that are at least one payment past due but does not include loans in the process of foreclosure. The percentage of loans in the foreclosure process at the end of the first quarter was 4.63 percent, an increase of five basis points from the fourth quarter of 2009 and 78 basis points from one year ago. This represents another record high.

The combined percentage of loans in foreclosure or at least one payment past due was 14.01 percent on a non-seasonally adjusted basis, a decline from 15.02 percent last quarter.

The serious delinquency rate, the percentage of loans that are 90 days or more past due or in the process of foreclosure, was 9.54 percent, a decrease of 13 basis points from last quarter, but an increase of 230 basis points from the first quarter of last year.

The seasonally adjusted delinquency rate increased for all loan types with the exception of FHA loans. On a seasonally adjusted basis, the delinquency rate stood at 6.17 percent for prime fixed loans, 13.52 percent for prime ARM loans, 25.69 percent for subprime fixed loans, 29.09 percent for subprime ARM loans, 13.15 percent for FHA loans, and 7.96 percent for VA loans. On a non-seasonally adjusted basis, the delinquency rate fell for all loan types.

The foreclosure starts rate increased for all loan types with the exception of subprime loans. The foreclosure starts rate increased six basis points for prime fixed loans to 0.69 percent, 17 basis points for prime ARM loans to 2.29 percent, 18 basis points for FHA loans to 1.46 percent, and eight basis points for VA loans to 0.89 percent. For subprime fixed loans, the rate decreased nine basis points to 2.64 percent and for subprime ARM loans the rate decreased 39 basis points to 4.32 percent.

Change from last year (first quarter of 2009)

Given the challenges in interpreting the true seasonal effects in these data when comparing quarter to quarter changes, it is important to highlight the year over year changes. The non-seasonally adjusted delinquency rate increased 151 basis points for prime fixed loans, 172 basis points for prime ARM loans, 343 basis points for subprime fixed loans, and 244 basis points for subprime ARM loans from the first quarter of 2009. The delinquency rate was 48 basis points lower for FHA loans and 12 basis points for VA loans relative to the same quarter a year ago.

The non-seasonally adjusted foreclosure starts rate increased eight basis points for prime fixed loans, 36 basis points for FHA loans and 17 basis points for VA loans compared to the first quarter of 2009. The rate decreased 22 basis points for prime ARM loans, 10 basis points for subprime fixed loans, and 259 basis points for subprime ARM loans on a year over year basis.

About half of the states saw increases in the rate of foreclosure starts on a year over year basis, with the largest increases coming in Oregon, North Carolina and Maryland. The largest decreases were in Florida, Rhode Island and California. Almost all of the states saw year-over year decreases in subprime ARM foreclosure starts while almost all had increases in prime fixed-rate and FHA foreclosure starts.

Submitted by Tim Harris on June 15, 2010 – 1:17 pm

Mortgage Loan Modification Re-Defaults Expected To Be 60-75 Percent

Adminkl — Tue, 22 Jun 2010 22:36:55 +0000

Submitted by Tim Harris of Harris University of Real Estate on June 18, 2010 – 11:38 am

Are loan mods the solution….well, no.

Not if you consider the fact that its widely believed that up to 75% of all loan mods will re-default.

Agents who are speaking with potential short sale sellers, what is one of the top reasons sellers give for not listing their home?

“We want to try a loan modification”

Share this article with your howeowners. Let them know that statistically very few mortgage loan modifications actually work beyond the initial period.

What homeowners don’t understand is that they will often be required to forfeit many ‘rights’ they may have. For example, we have seen loan modifications that literally make it so if the homeowner misses (or is late) on ONE payment during the trail mod their home is rushed into foreclosure, don’t stop at GO. Additionally, its a rare mod indeed that actually cancels out the negative equity. In other words, the mod may lower the payment temporarily but, the negative equity is still there.

Another fun fact, most mortgage loan modification are only for 3-5 years with a balloon payment often times including ALL that they still owed including their late fees, missed payments….etc

And don’t forget, homeowners have to qualify for a loan mod. Its treated like a fully documented loan application. Many homeowners won’t qualify for the home that they are currently living in!

Loan Modifications are clearly not what people think. Understand what mods are and aren’t…counsel your homeowners so they know what they are signing themselves up for.

Its no wonder why, up to 70% of all loan mods fail…..

Source: SNL.com

Economists and analysts predict redefaults will severely plague loan modifications, including one projection that 70% of all modifications will fail.

In a recent report projecting the level of shadow inventory in the housing market, Standard & Poor’s analysts noted that they assumed a 70% redefault rate on loan modifications in the study.

Diane Westerback, S&P’s managing director of global surveillance analytics, told SNL that the previously reported 30% to 40% redefault rates typically only count borrowers after two or three months of payments. A year after the modification, Westerback expects redefaults to hit between 60% and 70%.

See Above comments for just a few of the reasons why loan mods fail…

“I’ve always taken the position that if a guy pays for a year, he’s really made it. If he makes a few payments, you don’t really know,” she said.

Fitch Ratings on June 16 issued similar projections, albeit only for subprime and Alt-A loans in RMBS. The rating agency projects modifications on those product types to redefault at a 65% to 75% range, while prime loans in RMBS are expected to redefault at a rate of 55% to 65%.

Fitch said the government’s Home Affordable Modification Program appears to be “falling far short” of its stated goals, with Managing Director Diane Pendley noting in a news release that changes to the program mean “final determination of the program’s ultimate effectiveness will continue to be delayed.”

Where does all of this go….what happens to all of these failed loan modification? Millions of those homes will become short sale listings.

Agents, are you finally ready to learn the new ways to list and sell short sales? Chances are you have learned the very basics of how to do short sales…maybe, you have even successfully closed a few short sales. Its obvious that helping homeowners avoid foreclosure by selling their home as a short sale is one of this markets greatest opportunities.

The most recent mortgage metrics performance report released by the Office of the Comptroller of the Currency and the Office of Thrift Supervision showed stronger performance as of the 2009 fourth quarter than Fitch and S&P expect. Redefaults three months after modification have fallen to 14.7% for modifications completed in the 2009 third quarter from 35.1% for 2008 third-quarter modifications.

The report posted two redefault rates for a year after modification: 60.7% for 2008 third-quarter modifications and 57.9% for 2008 fourth-quarter ones.

A spokesman for the Office of Thrift Supervision told SNL that a new mortgage metrics report will be released in the next week or two, with the agency shooting for a June 23 release date.

A pair of economists told SNL that they do not consider a 70% redefault rate on loan modifications outlandish.

James Hamilton, a professor of economics at the University of California, San Diego, told SNL that concerted efforts to keep unsustainable loans out of foreclosure will translate to high redefault rates over the near term.

“I think I would rather err on the side of using too big a number,” Hamilton said.

In fact, Hamilton might be more pessimistic than Westerback, whose expectation of an up to 70% redefault rate is based on historical trends. “To the extent that we were modifying loans that historically you would have just given up on, that would make you suspect that the ultimate failure rate on those modifications would be higher than the historical rate,” Hamilton said.

Dean Baker, co-director of the Center for Economic and Policy Research, is not any sunnier on the outlook for loan modifications. On the 70% redefault projection, Baker told SNL that “it certainly doesn’t strike me as an absurd number. It’s certainly a very high number, but it’s not obviously unreasonable.”

Rather than historical trends, Baker attributes his pessimism on loan modifications to a naggingly high unemployment rate and chronic negative equity exacerbated by a renewal in falling prices.

Even on permanent HAMP modifications, Baker said, “I think you’re still going to be at a high redefault rate. Again, it’s both the weakness of the economy and you have so many people who are going to be underwater on their mortgages. You have limited incentive to struggle and pay your mortgage if you’re underwater. And that’s the situation a lot of people are going to be in.”