Supporter of a moratorium on foreclosures in Michigan standing outside a home that exploded on Lee Place near Woodrow Wilson on Detrot's west side, May 5, 2008. The home had been foreclosed. (Photo: Alan Pollock).
Originally uploaded by Pan-African News Wire File Photos
18.7 million vacant U.S. homes during 2nd quarter
BY KATHLEEN M. HOWLEY
BLOOMBERG NEWS
There were 18.7 million vacant homes in the United States during the second quarter as the steepest recession in 50 years sapped demand for real estate and banks seized properties from delinquent borrowers.
The number of vacant properties, including foreclosures, residences for sale and vacation homes, was little changed from 18.6 million a year earlier, the U.S. Census Bureau said in a report Friday. Households that own their own residence stood at 67.3%, seasonally adjusted.
Home values fell 33% since 2006, according to the S&P/Case-Shiller index, and the unemployment rate in June rose to the highest in almost 26 years. Tumbling home prices and rising job losses have thwarted government efforts to reverse the housing decline at the heart of the longest U.S. recession since the 1930s.
"Job insecurity, together with declines in home values and tight credit, is likely to limit gains in consumer spending," Federal Reserve Chairman Ben Bernanke told the House of Representatives Committee on Banking, Housing, and Urban Affairs on Tuesday.
Companies have shed about 6.5 million jobs since the recession began in December 2007, cutting demand for homes and eroding the consumer spending that makes up about 70% of the world's largest economy.
The average workweek fell to 33 hours in June, the lowest level on record, pushing the average weekly paycheck to $611.49, down 0.5% since February, the Labor Department said in a July 3 report.
One in every eight U.S. households with a mortgage is now late on their payments or already in foreclosure, according to Jay Brinkmann, chief economist for the Washington-based Mortgage Bankers Association.
The U.S. delinquency rate rose to a seasonally adjusted 9.12% in the first quarter and the share of loans entering the foreclosure process rose to 1.37%, the bankers' group said in a May 28 report. The total inventory of homes in foreclosure, old and new, was 3.85%. All three figures were the highest in records going back to 1972.
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