Homeowner equity is lowest since 1945

Homes are advertised for sale at discounted prices in Stockton, Calif., Thursday, Dec. 6, 2007. Home foreclosures soared to an all-time high in the final quarter of last year and are likely to keep on rising, underscoring the suffering of distressed homeowners and the growing danger the housing meltdown poses for the economy. (AP Photo/Marcio Jose Sanchez)

– + By J.W. Elphinstone

AP Business Writer / March 6, 2008

NEW YORK—Americans’ percentage of equity in their homes fell below 50 percent for the first time on record since 1945, the Federal Reserve said Thursday.Homeowners’ portion of equity slipped to downwardly revised 49.6 percent in the second quarter of 2007, the central bank reported in its quarterly U.S. Flow of Funds Accounts, and declined further to 47.9 percent in the fourth quarter — the third straight quarter it was under 50 percent.That marks the first time homeowners’ debt on their houses exceeds their equity since the Fed started tracking the data in 1945.

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