With more than 500,000 households in Michigan owing more on their mortgages than the homes are worth, thousands of Michigan residents are choosing to abandon their homes and walk away, even if they can afford to continue making payments.

The number of people who have engaged in such strategic defaults more than tripled between 2005 and 2008 — from 5,100 to 17,250, according to a report by Experian-Oliver Wyman, a credit reporting and consulting firm.

• Loan-workout companies offer advice for a price

• Renters on edge as landlords walk away

• Mortgage, tax bills ultimately come back to haunt walkaways

• Susan Tompor: Think twice before walking away

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• Database: Check home-sale prices

Full story is available on Freep

Jose and Anna Tolentino moved into their Novato condo in August 2005, two days before Jose, a Navy reservist, shipped out to Kuwait.

“I was happy to have my wife in such a nice place while I was away,” he said.

But now, with the condo worth about half the $425,000 they paid, his attitude has changed.

“I don’t want to keep on paying when the house will never go back up to its value,” he said. “It’s better to cut our losses, get out of there and go rent.”

The number of people similarly choosing to cut their losses on their homes continues to rise. Studies estimate about one-quarter of all defaults are voluntary “walkaways,” also known as strategic defaults and jingle mail (for the sound the abandoned keys make in a mailbox).

The Housing and Economic Recovery Act of 2008 mandated the U.S. Department of Housing and Urban Development (HUD) to produce a report on the root causes of the housing market crisis. The report also outlined actions that should be taken to avoid another housing crisis in the future. Various factors are to blame, but do they abolish the consumer’s idea of what happened?

The general public feels the housing crisis began because too many loans were given to too many people that couldn’t afford their mortgage payments. Home loans were created with adjustable rates and promises to hold off payments for 2 years, giving consumers false hopes that their homes would more affordable in the future. When the future came, those people were unable to make payments and foreclosures spread across the nation like a wildfire.

Full story is available on Huliq News

California has gone through many boom and bust cycles.  Since it became the 31st state in 1850 California has been home to many speculative manias.  An enormous population boom in the 1800s was brought on by the California gold rush.  Booms like this led to the rise of cities like San Francisco.  Los Angeles in the early 1900s found its footing as an entertainment hub and this led to massive expansion.  Since that time we have seen countless real estate booms and busts.

The current housing boom and bust cycle is the largest and most widespread in the state’s 160 year history.  As we look at historical data there is no lack of hyperbole when it comes to selling California real estate.  It would seem that every year is a good year to buy.  Of course as many are now finding out, timing is usually a bigger factor in determining housing success than investment savvy.

Full story is available on Dr. Housing Bubble

The extra-seasonal, government sponsored housing price bounce having reached its peak, in terms of pricing, in most markets in mid-summer of 2009 now appears to have nearly reverted for some.

The Radar Logic home price data now indicates that nine of the most corrected of markets are continuing to correct even after all the government propping.

This presents an unequivocal bump in the road of the supposed “V” shaped economic recovery as a significant “housing recovery” disappointment shapes up over the next few months.

Full story is available on Christian Science Monitor

The fight over what to do with a rundown house next to Genny’s Diner in Clifton continues. The property owner wants to knock it down, but legally he can’t. Now prosecutors say he should go to jail.

The house on Frankfort Avenue has been the center of a big controversy for years and the site of two fires. Frank Feris, the owner of Genny’s Diner next door says he paid $100,000 for it and wants to tear it down to turn it into a parking lot. The problem is he can’t because it is now part of Clifton’s historic preservation district, which means he has to restore it. The estimated cost for restoration is between $250,000 to $500,000.

Full story is available on Wave3

Billionaire Warren Buffett said the U.S. residential real estate slump will end by about 2011, predicting that’s how long it will take demand for homes to catch up with the supply.

“Within a year or so, residential housing problems should largely be behind us,” Buffett wrote Feb. 27 in his annual letter to shareholders of his Berkshire Hathaway Inc. “Prices will remain far below ‘bubble’ levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits.”

The worst housing decline since the Great Depression has left one in five U.S. mortgage holders owing more than their houses are worth. Record foreclosures last year flooded a real estate market already glutted with unsold property, causing new construction to fall to the lowest in at least 50 years. The fall in homebuilding is the only fix unless the U.S. decides to “blow up a lot of houses,” Buffett joked.

Fulls tory is available on Bloomberg

The rate at which home prices are dropping may be slowly coming to a halt across the United States, with analysts at Barclays Capital predicting only a 4 or 5% dip left to go before stabilization. But the rate of appreciation on the back side of that bottoming out is likely to “muddle along for the next few years,” they say in a weekly letter to investors.

This conclusion is based on expected aftershocks of the “smoothed-out” housing supply model, where millions of potential foreclosures are being averted temporarily with government-backed programs or by suppliers slowing the rate in which foreclosures hit the market. On the positive side, they say this effort actually prevented home prices from falling considerably more.

Full story is available on NU Wire Investor

America’s housing market implosion was the epicenter of the great Recession. It’s hardly surprising that the federal government directed enormous resources at the market. Besides bailing out vulnerable banks, the federal government nationalized mortgage behemoths Fannie Mae and Freddie Mac, opened the lending spigot at the Federal Housing Administration [FHA], passed a first-time home buyers’ tax credit, and established a mortgage modification program for troubled homeowners. the Federal Reserve embarked on a $1.25 trillion purchase of mortgage-backed securities in an effort to engineer lower mortgage rates. the Herculean efforts may be understandable. But they were a mistake in the early months of the downturn — and now stand as a public policy blunder in the early months of a recovery.

Full story is availabl e on Foreclosure Nightmare

It sounded like a great idea three months ago: Hand homeowners a $6,500 tax credit to find a new place to live, giving a thrust of energy to the housing market’s recovery.

So far, people are staying put.

In November, the federal government extended a tax credit of up to $8,000 for people who hadn’t owned a home for three years. This credit had helped boost home sales last summer and fall. Seeking to build on that momentum, the government added a new credit of up to $6,500 for current homeowners, hoping it would transform them into house-hunters this winter and spring.

Full story is available msnbc.com