According to the research firm CoreLogic, Inc., the number of homes underwater on their mortgage dropped in the third quarter - making it three quarters in a row in which that figure has done so. While 23 percent of all mortgage holders owed more than their home's value at the end of June, that number has now edged down to 22.5 percent.
Sounds like good news, right? Not really - the reason for the drop has almost everything to do with foreclosures. There are 110,000 foreclosures happening each month right now, which is the primary cause of underwater mortgages coming off the market. All told, the value of real estate held by American homeowners dropped by $649 billion in the third quarter, according to the Federal Reserve.
One silver lining to all of this is that existing homeowners are slowly getting stronger and stronger in their positions. The foreclosures may be difficult, but they are a necessary step to getting the housing market back on its feet.
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