The Real Deal Miami

One in five homes underwater

February 10, 2010 02:25PM

One in every five U.S. homes was underwater in the fourth quarter, according to a recent report from Zillow.com, a statistic that could significantly imperil the housing market. Because homeowners who owe more on their mortgage than their home is worth are more likely to default and less likely to qualify for a refinancing, that sector of the population faces a higher propensity to hit foreclosure. The news is particularly staggering, according to Stan Humphries, chief economist with Zillow, because it suggests that the economy isn’t close to leveling off yet. “The prevalence of markets in or near a double-dip situation shows that we are not yet at the bottom, in terms of home values,” Humphries said.