New Foreclosure and Spillover Projections
We now project that almost 2.2 million subprime foreclosures will occur primarily in late 2008 through the end of 2009, up from our original 1.1 million estimate made in 2006. Additionally we estimate that 40.6 million homes in neighborhoods surrounding those foreclosures will suffer price declines averaging over $8,667 per home and resulting in a $352 billion total decline in property values. These new projections—representing only property value declines caused by nearby foreclosures, not other price drops associated with the slowdown in local housing markets—are based on CRL research combined with data from Merrill Lynch, Moody's Economy.com, and the Mortgage Bankers Association
Table 1: Projected Subprime Foreclosure Impact in U.S.
UPDATED AUGUST 2008
|
Subprime foreclosures expected to occur (primarily in late 2008 through end of 2009) |
2,164,000 homes lost |
|
Spillover impact: |
|
|
Surrounding homes suffering price declines caused by nearby subprime foreclosures |
40.6 million homes |
|
Decrease in home values |
$352 billion |
|
Average decrease in home value per unit affected |
$8,667 |
Download full report for projected foreclosures and spillover impact by state.