All-time record foreclosures and a weak mortgage market are seeing home values plummet from their record highs. For the second year in a row Miami, Florida leads the list, which may be under going the worst housing crash in the nation's history. Miami has seen a record condo boom turn into a huge real estate bust.
The Worst 25 Housing Market forecasts are selected from more than 250 local housing markets forecast by Housing Predictor, which updates its predictions throughout the entire calendar year to keep visitors to its web site up to date on real estate markets in all 50 U.S. states.
Leading Wall Street investment bankers, real estate companies, new home builders, investors, home owners and many of the country's largest retailers depend on Housing Predictor for their forecasts. Housing Predictor forecast 86% of its forecasts correctly within a 1-2 percent margin in 2007.
Markets in Nevada, Arizona, Florida, Michigan, Massachusetts, Indiana and Georgia are among the states to place cities on the Worst 25 list. Declining home sales and record foreclosures have led to a spiraling deflationary cycle in housing sales, which has been troubled by the credit crunch and other mortgage problems.
Foreclosures have reached record levels in the majority of states and are only forecast to worsen in the new year as more than 2-million adjustable rate mortgages are reset in the next 18 months.
The housing crisis has sent jitters through investors on Wall Street, some of whom invested in mortgage securities funding the loans before realizing the real estate market in most areas of the country had gotten too artificially inflated by the securities.
The housing crisis is forecast to worsen through the year as the Federal Reserve, Congress and the White House try to get a handle on the problem. Increasing unemployment and a national economic slow down have added to the nation's mortgage woes.