Equity in US homes

An interesting fact about the crash of the US housing market is that
as a result home equity levels will drop significantly.

As said by numerous sources the average US homeowner has an equity level of 52%.
If these owners that have no mortgages are excluded, the typical "leveraged" US homeowner arrives at an equity level of 37%.

A simulated decline in total US homevalues of around 10% then results into a reduced equity level of only 26%. That represents the average leveraged US household, of course. What will happen to these who already borrowed 90% of their homevalue?

The logical consequence is at least further rising foreclosure numbers. An other logical consequence is greatly reduced willigness to consume once the threat of foreclosure nears. This may be the final end of the "home ATM".

Try my tool:

Equity level simulation