Predictions on the condition of the mortgage market vary, sometimes greatly. In this article Deutsche Bank – one of the world’s leading powerhouse banking and investment institutions – is predicting that about half of all U.S. mortgages will be underwater (owing more than their home is worth) by the first quarter of 2011. This is to include ‘Prime’ loans as well, not just ‘subprime.’
Whereas I can see the possibility of this in certainly markets, this would not be a universal, across the board mortgage crisis. Some metro areas are in much better shape than others. For example: the Detroit and Las Vegas areas will be offsetting the curve a great deal (in the negative), while other areas such as the Minneapolis area housing market, or the Dallas and Salt Lake City Housing markets are in much better shape.
It will be quite interetsting to see how this plays out, and I certainly hope Deutsche Bank is wrong in their prognostication for early 2011.
My advice if you are buying a home in the Minneapolis area housing market: if you can (depending on your price-point), buy your next home in Southwest Minneapolis, Edina and sometimes West Bloomington areas.
