The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: John Vosilla who wrote (25547)	12/1/2004 3:10:20 AM
From: Elroy Jetson	Read Replies (2) of 306849

Your assumption is correct. Here's the home equity percentage in America over time, currently 54% equity and 46% debt. home.pacbell.net along with a chart of the actual amount of equity extraction . . home.pacbell.net Of course this is made up of the 40% of home owners who have no debt, and the 60% of home owners who have 23.3% equity with 76.7% debt. (54% overall equity - 40% debt free)/ 60% with debt = 23.3% If estimates of the change in the number of debt-free home owners are incorrect, and the percentage of home owners without debt is still as high as 44%, then the average equity of home owners with debt is only 17.9% equity with 82.1% debt. (54% overall equity - 46% debt free)/ 54% with debt = 17.9% § As a consequence, a decline of only 18% to 24% in home prices will eliminate all of the average equity backing real estate loans! .

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