When we look back to 1930 and the period known as “The Great Depression”, more than 1000 banks closed. While we are in the midst of economic uncertainty, only 14 U.S. banks have been taken over in 2008. The current situation, globally, creates a time of “opportunity” for investors, and at the same time, is not an opportune time for sellers. There are approximately 76 million households in the U.S. that own their home. 24 million of these homes are owned free and clear. 52 million homes in the U.S. are with mortgages – 97.2% of these are not in foreclosure and 93.8% of these homes are current on their payments. However, on a more sobering note, over 20% of homeowners with a mortgage owe more than their home is worth and 40% of all foreclosures are non-owner occupied.
On an interesting note, please see chart below. It compares on a decade by decade basis the number of homes sold. The first column shows the highest number of homes sold (at the highest year). The 2nd column shows the average over the whole 10 year period. In the current decade 2005 was the highest point at 7.1 mill, and 2007 was 5.6 mill, coincidentally. As of September 2008 this was at 4.8 mill for the year.
|Decade||Homes Sold High||Homes Sold Average|
|1970's||3.9 million||3 million|
|1980's||4 million||3.3 million|
|1990’s||4.9 million||3.9 million|
|2000's||7.1 million||5.6 million|
|Resale numbers – the above does not include new home sales.|
Sources: Wall Street Journal / Moody’s Economy.com /
RealtyTrac / NAR / Forbes