More LI mortgages underwater in spring

By MAURA MCDERMOTT: Published September 13, 2012 by Newsday: Originally published: September 12, 2012 8:50 PM by Newsday


More Long Islanders were underwater on their mortgages this spring than the previous spring, CoreLogic reported Wednesday.


In Nassau and Suffolk counties, 48,546 homeowners owed more on their mortgages than their homes were worth during the second quarter. That added up to 9 percent of all homeowners with mortgages, compared to 8.4 percent during the second quarter of 2011, according to the data provider.


"We do see a lot of people coming in here whose mortgages are definitely underwater, who need assistance," said Peter Elkowitz, president and chief executive of the nonprofit Long Island Housing Partnership.


Troubled homeowners should seek out a free, federally certified housing counselor, since some may qualify for foreclosure prevention programs that reduce their outstanding loan balance, he said.


While the percentage of underwater loans on the Island remains much smaller than the percentage nationally, the rise in troubled mortgages here came as there was slight improvement on the national front.


Across the United States, 10.8 million homeowners -- or 22.3 percent of all homeowners with mortgages -- owed more than their homes' value from April through June, down from 23.7 during the same time last year, CoreLogic reported.


Long Island homeowners have been whipsawed by real estate news, with some data providers reporting signs of trouble in the housing market, while others show home prices rising.


On Tuesday, the Multiple Listing Service of Long Island reported that the median home price was up 4.8 percent in Nassau County and 0.7 percent in Suffolk County last month, compared to the same period in 2011.


The boost could help lift some Long Island homeowners out of distress, Elkowitz said. However, those who saw home values plummet by 50 percent to 70 percent since the housing bubble burst are unlikely to recover, he said. Such homes, he said, "will never go back up to the original value."

In the second quarter -- the time period reflected in Wednesday's CoreLogic report -- the median home price in Nassau County dropped by 1.3 percent compared to the previous spring, according to a report by the appraiser Miller Samuel and the brokerage Prudential Douglas Elliman. Prices fell by 4.1 percent in the Hamptons and the North Fork, and held steady across the rest of Suffolk County, according to the second-quarter report.