More young people are living with their parents instead of moving out,
postponing the creation of their own households. Meanwhile, more
families are combining households for economic reasons, including the
loss of a home due to foreclosure, said Gary Painter, associate
professor in the School of Policy, Planning and Development at USC.
“With such a significant drop in households nationwide, it is clear the
most recent recession impacted individuals’ decisions to move out on
their own and caused many Americans to join already formed households,”
Painter said in a news release.

The decline in the number of households contributed to the excess supply
of apartments and single-family homes on the market. “The housing and
mortgage industries will feel the impact of this reduction in the number
of households for years to come,” Painter said in the report, which was
sponsored by the Mortgage Bankers Association’s Research Institute for
Housing America, a trust fund that aids research on mortgage markets and
real estate finance. Also, the recession caused a fivefold increase in
the rates of overcrowding, he said. A household that has more than one
person per room indicates overcrowding.

While the analysis incorporates data only through 2008, Painter said the
decline in household formation likely continued through 2009. “Clearly,
given the depth of the downturn in 2009, and the ongoing weakness in the
job market through the beginning of this year, this study gives no
reason to expect that household formation has picked up at all,” he said.

There’s a strong tie between unemployment and household formation rates,
Painter said. The national unemployment rate was 9.7% in March 2010, but
the recession hit younger workers much harder. Workers between the ages
of 16 to 24 peaked at a record high of 19.2% in September 2009, up from
11.8% in December 2007, according to a recent report from the Economic
Policy Institute.

Household formation should begin a return to a more normal level by
2012, as unemployment rates decline, Painter said. But he said there
isn’t a “demographic silver bullet” to solve the overhang of housing
supply in many markets.

However, when conditions do improve, there could be more young adults
becoming homeowners instead of moving into a rental unit, he said.
“Young adults need not only a paycheck, but also a sense that they have
sustainable employment before striking out on their own,” Painter said.
“Typically, many new households are renters, but if young adults
postpone moving out, some may have the ability to save for a down
payment, causing them to skip the rental stage and move right to
homeownership.”

The study, which analyzes data from the past 40 years, examines the
historical impact of recessions and elevated unemployment rates on the
formation of households. Findings include:

-The likelihood of a young adult forming an independent household falls
up to 4% in a recession, depending on the person’s age and the severity
of the changes in unemployment rates.

-The national homeownership rate has fallen to just above 67%, from
above 69%. Renter household formation dropped even more than the
formation of homeownership households.

-Native-born Americans showed a larger decline in household formation
and a larger increase in overcrowding rates than immigrants.

-Parents with higher incomes are more likely to have young adults living
with them instead of moving into the rental market. But children with
parents who have higher financial wealth are more likely to form their
own new rental households.

(c) 2010, MarketWatch.com Inc.

Distributed by McClatchy-Tribune Information Services.

That’s because lenders have been quietly selling second mortgages and
home equity lines left unpaid after foreclosures and short sales. The
buyers: collection agencies, which in some states have years to make a
claim. If they win court judgments, these collectors could have years to
pursue borrowers with repayment plans, and even garnish their wages,
said Scott CoBen, a Sacramento bankruptcy attorney.

“The only relief a consumer will have is entering into a debt
negotiating plan or filing for bankruptcy,” said Sylvia Alayon, a vice
president with the New York-based Consumer Mortgage Audit Center. The
firm provides mortgage analysis to lenders, advocacy groups and attorneys.

The phenomenon suggests an ominous, looming echo of today’s real estate
meltdown. As debt collectors surely seek at least partial repayment of
millions of dollars in unpaid home loans, some say renewed financial
stresses on tens of thousands of local consumers could dampen economic
recovery.

“I think there will be a lot of unhappy people when it hits,” said
CoBen. “We saw this in the ’90s. This is not really new. Just when you
think you’re back on your feet, you’re making money and the economy’s
good, they hit you with this.”

Alayon said most people are so stressed out and exhausted by trying to
save their homes today that they are unaware they could face another hit
later. And many who are losing homes don’t get the advice necessary to
prevent future fallout, say nonprofit loan counselors.

“You’ve got tens of thousands of people in California who have this
hanging over their heads who don’t even know it,” said Scott Thompson,
principal at for-profit Mortgage Resolution Services in Carmichael,
Calif. He fears a new wave of bankruptcies might flatten people just
starting to recover from losing their homes.

“So many of these are people with 750 or 800 credit scores who made a
bad decision,” said Thompson. “Or they’re people who suffered income
cuts. These are people, in terms of the economy, whom we need to
participate.”

But an entire industry is gearing up to buy their debt at deep discounts
and collect what they can, Alayon said. “It’s a big business and
investors are coming out of the woodwork. It’s a very lucrative
business,” she said. Real estate insiders and financial players know it
as “scratch and dent.”

Regionally, no one knows for sure how much unpaid debt is on the line.
CoBen said people who used their borrowings for a traditional loan on a
house in which they lived generally have little to worry about. But
borrowers may be vulnerable in years ahead—generally, those who
defaulted not only on their first mortgage but also on a home equity
loan or second mortgage.

In California, banks can’t collect from borrowers for primary, so-called
“first-lien,” loans that go unpaid. When a house is foreclosed or sold
through a short sale, the lender of the first loan gets the house back
or the proceeds from another buyer.

But banks also made thousands of “second-lien” loans, including those
used to finance 20% down payments during the housing boom. A separate
category of “seconds” includes home equity loans and home equity lines
of credit. Nationally, about 3.4% of those loans are currently
delinquent, according to Foresight.

Owners are generally, but not always, on the hook for the second loans
left over from a foreclosure or short sale. Most investor mortgages,
too, leave the borrower liable for potential unpaid debt. In many short
sales, experienced real estate agents or attorneys can negotiate away
debt obligations for the second-lien loan. But many inexperienced
borrowers don’t know that, and sign final-hour agreements giving lenders
the right to pursue them later.

“Seek advice,” counseled Doug Robinson, spokesman for national nonprofit
mortgage counselor NeighborWorks America. He said nonprofit counselors
can help. “Often when you work with a real estate agent, they’re not
really equipped to handle the repercussions. They’re set up to make the
sale,” he said.

Government forces are already moving to limit potential damage to
millions now struggling with home loans. A new Obama administration
short sale program aims to prevent banks that hold second-lien loans
from pursuing collections from homeowners after the short sale. It goes
into effect April 5, 2010 and works this way: Sellers will receive
notice that their servicer has steered part of the sales proceeds to
secondary lien holders “in exchange for release and full satisfaction of
their liens.” This release would apply only to short sales done through
the administration’s Home Affordable Foreclosure Alternatives program.

In California, Democratic state Sen. Ellen Corbett recently introduced
SB 1178, which would expand California’s protections for some people who
refinance and take on a second mortgage.

People who refinance, but use the funds to improve their homes or to
stay in their homes with a better interest rate, would be protected.
Lenders could not seek court judgments to collect from these borrowers
in the event of foreclosure or short sales.

“If you refinance a property and aren’t using the money for personal
reasons, you shouldn’t lose your personal protections,” said California
Association of Realtors lobbyist Alex Creel. He said the idea has been
around for years but has become more urgent as thousands lose income and
fall into mortgage trouble. The bill would apply to all foreclosures or
short sales that occur after it becomes law. It doesn’t matter when the
loan was made, Creel said. SB 1178 is still in the early stages of
consideration. It must clear both houses of the Legislature and be
signed by Gov. Arnold Schwarzenegger by Sept. 30 in order to take effect.

(c) 2010, The Sacramento Bee (Sacramento, Calif.).

Distributed by McClatchy-Tribune Information Services.

THINGS YOUR  BURGLAR WON’T TELL YOU:

1. Of course I look familiar. I was here just last week cleaning your carpets, painting your shutters, or delivering your new refrigerator.

2. Hey, thanks for letting me use the bathroom when I was working in your yard last week. While I was in there, I unlatched the back window to make my return a little easier.

3. Love those flowers. That tells me you have taste … And taste means there are nice things inside. Those yard toys your kids leave out always make me wonder what type of gaming system they have.

4. Yes, I really do look for newspapers piled up on the driveway. And I might leave a pizza flyer in your front door to see how long it takes you to remove it.

5. If it snows while you’re out of town, get a neighbor to create car and foot tracks into the house. Virgin drifts in the driveway are a dead giveaway.

6. If decorative glass is part of your front entrance, don’t let your alarm company install the control pad where I can see if it’s set. That makes it too easy.

7. A good security company alarms the window over the sink. And the windows on the second floor, which often access the master bedroom-and your jewelry. It’s not a bad idea to put motion detectors up there too.

8. It’s raining, you’re fumbling with your umbrella, and you forget to lock your door-understandable. But understand this: I don’t take a day off because of bad weather.

9. I always knock first. If you answer, I’ll ask for directions somewhere or offer to clean your gutters.

10. Do you really think I won’t look in your sock drawer? I always check dresser drawers, the bedside table, and the medicine cabinet.

11. Here’s a helpful hint: I almost never go into kids’ rooms.

12. You’re right: I won’t have enough time to break into that safe where you keep your valuables. But if it’s not bolted down, I’ll take it with me.

13. A loud TV or radio can be a better deterrent than the best alarm system. If you’re reluctant to leave your TV on while you’re out of town, you can buy a $35 device that works on a timer and simulates the flickering glow of a real television. (Find it at faketv.com <http://faketv.com/> .)

8 MORE THINGS A BURGLAR WON’T TELL YOU:

1. Sometimes, I carry a clipboard. Sometimes, I dress like a lawn guy and carry a rake. I do my best to never, ever look like a crook.

2. The two things I hate most: loud dogs and nosy neighbors.

3. I’ll break a window to get in, even if it makes a little noise. If your neighbor hears one loud sound, he’ll stop what he’s doing and wait to hear it again.  If he doesn’t hear it again, he’ll just go back to what he was doing. It’s human nature.

4. I’m not complaining, but why would you pay all that money for a fancy alarm system and leave your house without setting it?

5. I love looking in your windows. I’m looking for signs that you’re home, and for flat screen TVs or gaming systems I’d like. I’ll drive or walk through your neighborhood at night, before you close the blinds, just to pick my targets.

6. Avoid announcing your vacation on your Facebook page. It’s easier than you think to look up your address.

7. To you, leaving that window open just a crack during the day is a way to let in a little fresh air. To me, it’s an invitation.

8. If you don’t answer when I knock, I try the door. Occasionally, I hit the jackpot and walk right in.

Sources: Convicted burglars in North Carolina, Oregon, California, and Kentucky; security consultant Chris McGoey, who runs crimedoctor.com <http://crimedoctor.com/> ; and Richard T. Wright, a criminology professor at the University of Missouri-St. Louis, who interviewed 105 burglars for his book Burglars on the Job.

“As more consumers begin to realize how much their home affects every aspect of their health, they are beginning to see the importance of improving its environmental quality with products to benefit their health and that of their family,” Lenahen said. “The new emphasis toward healthy living focuses around four main categories – air, water, odor/fumes and lighting.”

According to the U.S. Green Building Council, pollutants are often two to five times higher indoors than outdoors and this can significantly affect air in the home causing breathing problems and respiratory diseases. When it comes to the quality of the air, Lenahen said several products are available on the market that homeowners should incorporate into their home such as:

-Advanced allergy filters to control dust particles and pollutants
-Dehumidification devices to manage the humidity in the home
-Variable speed air handlers to maintain the circulation of air throughout the home and ventilation fans to introduce fresh air into the home while removing stale, humid air

Improving the water quality in a home is just as important as the air quality, Lenahen said. Several products are available to improve the quality and efficiency of a home’s water flow and usage, including:

-Carbon filter and reverse osmosis units to purify drinking water by removing particulate matter and harmful minerals
-Whole-house water softeners to remove calcium and other harmful minerals while providing added benefit to the home’s appliances and pluming fixtures. Water softeners also improve skin tone and texture by removing calcium, magnesium and iron from the water.
-Underground cisterns to collect rainwater from the gutter and downspouts to use for irrigating the lawn and landscapeHealthy home living is also improved by the use of low Volatile Organic Compound (VOC) materials, which emit lower levels of gasses into the home from everyday materials such as paints, sealants, cabinets and flooring materials. Lenahen said homeowners should use the lowest emitting VOC products for custom homebuilding and remodeling projects, thereby reducing the negative health impact the products may have on the occupants. Low VOC products will have labeling to help homeowners find the healthiest option.

Better lighting solutions can also foster healthier living. Traditional light fixtures typically include high wattage bulbs, which waste electricity while adding excessive heat into the home. Suggested improvements include:

-Decorative light fixtures with less wattage requirements and soft-light emitting globes
-Compact florescent light (CFL) bulbs or L.E.D. fixtures and bulbs for longer life usage
-Next generation skylights, such as Velux Sun Tunnel or Solatube, that bring natural light into the home, reducing the need for artificial light and energy consumption

“These are just some of the many changes that can be made to current homes or built into new homes that will greatly improve the quality of life and health of its occupants,” Lenahen said. “The more consumers become aware of the positive affects of healthy living within the home, the more products will enter the mainstream of standard building practices.”