Low Inventory Gets Another Wallop

There have been a few hints that the curse of low inventory is beginning to ease but today brings the strongest sign ever: fewer people are underwater on their mortgages. The total number of 'underwater' mortgages is now under ten million, or just under 20% overall. This is down from 25% at the end of 2011, so it is a step in right direction to get owners to put their houses on the market. This is based on a new report released by CoreLogic that was reported in the Wall Street Journal today but it doesn't mean we're out of the woods yet. Even though homeowners are seeing an increase in equity, there is still a large proportion with less than 20% equity in their homes so the margins may still be too tight to motivate them to list. So, the silver lining is getting thicker but we're still going to have a sluggish market for at least the near future and possibly longer.